Fitch Assigns Final Ratings To Dragados' Term Trade Receivables Securitisation.Business Editors LONDON--(BUSINESS WIRE)--July 1, 2003 Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. , the international rating agency, has assigned a final rating of 'AAA' to the EUR EUR In currencies, this is the abbreviation for the Euro. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 300 million floating-rate notes Floating-rate note (FRN) Note whose interest payment varies with short-term interest rates. floating-rate note An unsecured debt issue with an interest rate that is reset at specified intervals (usually every six months) according to a issued by CAP-TDA 1 Fondo de Titulizacion de Activos (CAP-TDA 1). The rating addresses the likelihood of investors receiving full and timely interest payments and repayment of principal by legal final maturity in September 2013. This transaction is a securitisation of trade receivables originated in Spain by Grupo Dragados, S.A. (Dragados) and a number of its subsidiaries. The initial portfolio is generated from 17 separate originators in the Dragados group, all of which is 99% owned, directly or indirectly, by Grupo Dragados, Spain's largest construction company. Dragados guarantees the servicing and financial obligations of its subsidiaries in respect of the receivables sold to the issuer. Each originator is in one of the construction, industrial or services divisions of Dragados. Receivables represent amounts due in respect of works already completed or services already provided by the relevant originator. The issuer, CAP-TDA 1, is a bankruptcy-remote asset securitisation fund established under Spanish law. The issuer constitutes a pool of assets without legal status and is open ended in terms of its assets but closed ended in terms of its liabilities. Asset substitution Asset substitution Occurs when a firm invests in assets that are riskier than those that the debtholders expected. will occur during the revolving period, which is expected to end in October 2009. Credit enhancement Credit Enhancement A method whereby a company attempts to improve its debt or credit worthiness. Notes: Credit enhancements take many different forms. An example of a credit enhancement would be conversion rights added on to a debt instrument in order to lower the issuing for the notes comprises a dynamic default reserve, established in accordance with Fitch's criteria for trade receivables (see 'Rating Trade Receivables Securitisations', dated January 2001 and available on the Fitch Ratings web site at 'www.fitchratings.com'). The default reserve will be subject to a floor of 10%. A dynamic dilution reserve is also provided, sized in accordance with Fitch's criteria for trade receivables. At close, the dynamic dilution calculation produces a zero result, so the reserve will be fixed at 1% for the first three months. In the event of the insolvency of Dragados, there is a reserve to cover the commingling Combining things into one body. The term commingling is most often applied to funds or assets. When a fiduciary, a person entrusted with the management of funds other than his or her own in trust, mixes trust money with that of others, the fiduciary is commingling of cash of at least 6%, as well as a litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. costs reserve to cover the cost of enforcing security on obligors who seek to withhold with·hold v. with·held , with·hold·ing, with·holds v.tr. 1. To keep in check; restrain. 2. To refrain from giving, granting, or permitting. See Synonyms at keep. 3. payment. A further reserve addresses the cost of funding the notes and other senior costs, and a liquidity facility is provided to cover any cash flow delays in enforcing security. The rating of the notes relies on the quality of the receivables; the dynamic credit enhancement provided by way of over-collateralisation; the origination and servicing capabilities of the Dragados group; and the sound legal and financial structure of the transaction. A copy of the new issue report for this transaction is also available at 'www.fitchratings.com'. |
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