Continued Momentum with Second AAA-Rated Securitization of 2022 Following Strong Business Performance
NEW YORK, August 18, 2022 — Octane® (Octane Lending Inc.®), the fintech revolutionizing the buying experience for major recreational purchases, announced that it has closed a $375 million securitization (“OCTL 2022-2“) collateralized by its fixed-rate installment powersports loans. This transaction, Octane’s second securitization of 2022 and sixth since launching the program in December 2019, follows a period of record-breaking success for the company.
OCTL 2022-2 issued four classes of fixed-rate notes: Class A, Class B, Class C and Class D, which Kroll Bond Rating Agency (KBRA)* and Standard & Poor’s (S&P)** rated as AAA/AA(sf), AA/AA-(sf), A/A(sf), and BBB/BBB(sf), respectively in a private offering pursuant to Rule 144A under the Securities Act of 1933, as amended.
Through this issuance, the company continued to diversify its investor base with new investors, which is a testament to the strength and growth of the program. Additionally, due to significant investor demand, Octane was able to secure an upsize of the transaction from an initial target issuance of $300 million to $375 million in notes. J.P. Morgan acted as lead bookrunner and structuring agent, with Credit Suisse and Truist Securities as joint bookrunners.
Steven Fernald, Chief Financial Officer at Octane, said: “Our ability to attract and retain such a diverse mix of institutional investor partners is particularly notable in the current market environment. We are grateful for their continued support, which also better positions us to connect people with their passions and make buying better through our revolutionary, end-to-end digital experience.”
This issuance follows a period of consistent, strong performance for Octane. The company overcame inventory constraints and other headwinds to solidify its position as one of the top three non-captive lenders in the industry. During the first half of 2022, it increased originations by 67% year over year through its in-house lender Roadrunner Financial, Inc., and increased fundings in its consumer channel by 80% year over year. Over the same period, Octane entered two new markets, tractors and trailers, signed new OEM partnerships, and launched new products to increase the speed and ease of buying.
Octane’s first asset-backed securitization of 2022, OCTL 2022-1, a $375 million transaction which closed in May, also received a AAA-rating from KBRA and was upsized from an initial $275 million target issuance. The company has completed nearly $1.9 billion of asset-backed securitizations to-date.
This press release does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.
*KBRA’s ratings are subject to all of the terms and conditions set forth in the related report and KBRA’s website, which you should review and understand, and can be accessed here.
**The full analysis for S&P’s ratings, including any updates, which you should review and understand, is available on standardandpoors.com and can be accessed here.
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