Netherlands-based Rabobank is selling a $225 million portfolio of food industry credits as it seeks to liquidate positions in its U.S. portfolio, according to investors. The auction is due to take place Thursday morning. The portfolio contains large chunks of low coupon names. Thirteen credits are in the portfolio, including $11.5 million of American Seafoods Group, $18.2 million of National Beef Packing, $77 million of Constellation Brands, $27.5 million of SUPERVALU's term loan "A" and an unknown amount of Southern Wine & Spirits' term loan "B." A Rabobank spokeswoman did not return a call.
One investor said Rabobank is adjusting the capital allocation to its U.S. business and is selling existing loans to make room for new business. He added the loan contains mostly food credits because the food, beverage and agribusiness is Rabobank's main focus in the U.S.
One of the investors predicted the portfolio will be bid under par in the secondary because the credits have low coupons. "It will probably go to one of the dealers and they will sit on it," he said. Another investor said the portfolio will probably be sold to a variety of institutional investors rather than sold as a whole. "It makes economic sense to sell it separately," he said.
