Newton Commercial Finance discusses $180 million bond offering with investors
The potential asset-backed securities deal includes collateral tied to artificial intelligence chip loans and equipment leases.
Newton Commercial Finance is in early talks with investors regarding a potential $180 million bond offering, according to Mint.
The joint venture between Apple Bank and Eagle Point Credit Management plans to issue asset-backed securities (ABS) supported by equipment loans and leases.
Loans tied to artificial intelligence (AI) chips, including graphic processing units (GPUs), are expected to make up about 15 per cent of the collateral pool. Other assets in the pool are expected to include marine assets at about 20 per cent and fixed wing aircraft at about 15 per cent.
The ABS are expected to be rated by Morningstar DBRS, with ratings potentially ranging from the AAA to the BB tier. Plans and details are not yet final and may change, people familiar with the matter said.
A representative for Newton Commercial Finance declined to comment on the matter.
This follows recent equipment loan and lease ABS deals from Stonebriar Commercial Finance and Wingspire Equipment Finance, which also included GPU exposure.