Ranking Motion: Moody’s Affirms Minotaur Acquisition’s B3 company household ranking and modifications outlook to secure from negativeGlobal Credit score Analysis – 16 Feb 2022New York, February 16, 2022 — Moody’s Buyers Service (“Moody’s”) in the present day affirmed Minotaur Acquisition, Inc.’s (Minotaur) B3 company household ranking (CFR), B2 backed senior secured first lien time period mortgage and revolving credit score facility rankings and affirmed its Caa2 backed senior secured second lien time period mortgage ranking. Minotaur is the debt-issuing entity of Millennium Belief Firm, LLC (Millennium). On the identical time, Moody’s has modified Minotaur’s outlook to secure from destructive.Affirmations:..Issuer: Minotaur Acquisition, Inc.Company Household Ranking, Affirmed at B3Backed Senior Secured First Lien Revolving Credit score Facility, Affirmed at B2Backed Senior Secured First Lien Time period Mortgage, Affirmed at B2Backed Senior Secured Second Lien Time period Mortgage, Affirmed at Caa2Outlook Actions:..Issuer: Minotaur Acquisition, Inc.Outlook, Modified to Secure from NegativeRATINGS RATIONALEMoody’s mentioned the rankings’ affirmation displays Minotaur’s robust progress in buyer accounts and shopper money, excessive EBITDA margin and market management within the automated rollover particular person retirement account (IRA) market. The rankings’ affirmation additionally displays Minotaur’s prudent method to its money sweep program, which is laddered over a lot of years and advantages from mounted deposit preparations throughout a lot of accomplice banks. The rankings additionally mirror the agency’s small scale, weak (albeit enhancing) pretax earnings, sensitivity to rates of interest, and its possession by a monetary sponsor which might lead to aggressive monetary administration actions over time resembling will increase in debt leverage.The change in Minotaur’s outlook to secure from destructive displays enhancements in Minotaur’s trailing-12-months Moody’s-adjusted debt / EBITDA ratio to round 4.9x at 30 September 2021, in comparison with 5.6x at 31 December 2020 and 6.3x at 31 December 2019. Moody’s expects Minotaur’s leverage ratio to worsen barely in 2022 (assuming no modifications to the agency’s capital construction) however stay at a degree in line with its present rankings.The change in outlook additionally displays diminished erosion of Minotaur’s service and administrative income from a modified rate of interest surroundings. Moody’s now expects three US rate of interest will increase in 2022 and 4 extra will increase in 2023 which can profit Minotaur’s service and administrative payment income. Though a big portion of high-yielding deposit contracts had expired in 2021, greater rates of interest and powerful account progress will scale back the general destructive impression on this income. Primarily based on the laddering and expiration of Minotaur’s current money sweeps, Moody’s nonetheless expects a average decline in interest-rate-linked income throughout 2022. Nonetheless, Minotaur’s robust progress in buyer accounts and shopper money, in addition to its potential to generate optimistic working leverage will finally offset these declines.In accordance with Moody’s Loss Given Default (LGD) for Speculative-Grade Corporations methodology and mannequin, the B2 rankings on Minotaur’s $595 million first lien time period mortgage and $90 million revolving credit score facility mirror their precedence rating in Minotaur’s capital construction. The Caa2 ranking on Minotaur’s $245 million second lien time period mortgage displays the ability’s secondary rating in Minotaur’s capital construction.Minotaur Acquisition, Inc. is the acquisition car by way of which entities of Abry Companions acquired Millennium Belief Firm, LLC, which operates as a belief firm beneath the legal guidelines of the state of Illinois. Millennium relies in Oak Brook, Illinois and gives administration and custodial providers for retirement accounts to people, advisors and establishments in addition to different institutional providers.FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGSMinotaur’s rankings may very well be upgraded ought to it increase its income streams or develop new income sources throughout the self-directed IRA or fund custody actions that would cut back reliance on rates of interest.The demonstration of a extra creditor-friendly monetary coverage, resembling paying-down debt or organically deleveraging to ranges under 5.0x on a sustained foundation, might additionally lead to an improve.Minotaur’s rankings may very well be downgraded ought to it reveal more and more aggressive monetary insurance policies by way of an additional enhance in debt leverage to fund shareholder dividends or acquisitions.The rankings is also downgraded ought to rates of interest stay very low and lead to vital profitability erosion not offset by price administration or different income streams, or with indication that the agency is keen to tackle extra rate of interest threat.A major deterioration in franchise worth from authorized, regulatory, compliance or different points that would cut back income, enhance prices, and harm relations with record-keepers and plan sponsors might additionally lead to a downgrade.The principal methodology utilized in these rankings was Securities Business Service Suppliers Methodology printed in November 2019 and out there at https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_1187116. Alternatively, please see the Ranking Methodologies web page on www.moodys.com for a replica of this technique.REGULATORY DISCLOSURESFor additional specification of Moody’s key ranking assumptions and sensitivity evaluation, see the sections Methodology Assumptions and Sensitivity to Assumptions within the disclosure kind. Moody’s Ranking Symbols and Definitions could be discovered at: https://www.moodys.com/researchdocumentcontentpage.aspx?docid=PBC_79004.For rankings issued on a program, collection, class/class of debt or safety this announcement gives sure regulatory disclosures in relation to every ranking of a subsequently issued bond or be aware of the identical collection, class/class of debt, safety or pursuant to a program for which the rankings are derived completely from current rankings in accordance with Moody’s ranking practices. 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