Fitch: Russell view to negative

Fitch Ratings said it affirmed the BB long-term issuer default rating and senior secured debt rating assigned to Russell Investments US Institutional Holdco, Inc. and Russell Investments US Retail Holdco, Inc.

Fitch also said it affirmed the BB long-term issuer default rating of Russell Investments Cayman Midco., the holding company for the combined organization.

The outlook also was revised to negative from stable.

These rating actions follow Russell’s announced intention to increase its secured debt by $200 million, Fitch said.

The incremental issuance is expected to be identical, in terms of payment priority, maturity and interest rate, to the existing $650 million of secured debt maturing in June 2023, the agency said.

The proceeds will be used for a one-time dividend distribution to Russell’s private equity shareholders, Fitch explained.

Private equity ownership introduces the risk of more equity-oriented actions, as evidenced by these actions.

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