S&P rates Russell Investments Cayman BB

S&P said it assigned the BB issuer credit rating on Russell Investments Cayman Midco Ltd.

The outlook is negative.

The agency also said it affirmed the BB rating on the $847 million senior secured first-lien term loan and $50 million senior secured revolving credit facility issued by Russell Investments US Institutional Holdco Inc. and Russell Investments US Retail Holdco Inc., two subsidiaries of Russell.

Russell Investments guarantees the debt.

The recovery rating remains at 3, indicating 50% expected default recovery.

The majority of the company's revenues are generated from the investment management division with capabilities to manage assets in house or through the selection of external managers, S&P said.

The negative outlook reflects an expectation that the company will operate with debt-to-adjusted EBITDA at about 5x in the next six- to 12-months as gains from meaningful cost synergies offset the increase in funded debt, the agency said.

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