KBRA Assigns Preliminary Ratings to Rosy Blue Carat S.A.

Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to two classes of notes issued by Rosy Blue Carat S.A.

Rosy Blue NV (the Seller and Servicer) was founded in 1973 and is active in multiple areas of the global diamond industry, from rough-cutting to polishing to import/export and wholesaling. The Rosy Blue Business Alliance was established in 1960 in Mumbai, India and subsequently established an office in Antwerp, Belgium in 1973. This is the companys first securitization issued under rule 144A. Rosy Blue NV completed a diamond receivables securitization in 1999, the first diamond inventory securitization in 2001, and a private securitization earlier in 2018 that will be refinanced with this issuance.

The collateral for the transaction consists of Rosy Blues rough and polished diamond inventory, as well as outstanding receivables. The transaction features a borrowing base concept whereby the eligible collateral balance must equal or exceed the then outstanding aggregate debt balance plus a dynamic overcollateralization amount. Failure to comply with the borrowing base test for 10 consecutive business days results in an amortization event.

The Class A-1 and A-2 notes have an anticipated repayment date (ARD) of 4 years from the initial anticipated closing date. If any note class is not fully refinanced on or prior to the ARD, all excess cash flow is applied to pay down both note classes. No amortization is required for the Senior Notes prior to the ARD; however, the borrowing base mechanism is designed to ensure that the transaction maintains sufficient collateral coverage for noteholders at all times.

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KBRA analyzed the transaction using the Global General Rating Methodology for Asset-Backed Securities published on November 28, 2017. In applying the methodology, KBRA analyzed the companys historical data, financial information and other relevant industry-related price information.

Class of Notes     Preliminary KBRA Rating     Initial Principal Amount*
A-1     A (sf)     $75,000,000
A-2     A (sf)     $75,000,000

*Note classes will be sized to demand.

To access ratings, reports and disclosures, click here.

Related Publications: (available at www.kbra.com)

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About KBRA and KBRA Europe

KBRA is a full service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus, is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.

Kroll Bond Rating Agency
Analytical:
John
Lampasona, Director
(646) 731-2318
[email protected]
or
Anthony
Nocera, Senior Managing Director
(646) 731-2350
[email protected]
or
Lenny
Giltman, Managing Director
(646) 731-2378
[email protected]

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