American Capital Access has tweaked the structure of a collateralized debt obligation it is marketing, eliminating its flexibility. The change is apparently a bid to appease investors who may be concerned given recent personnel departures at the company. Maryam Muessel, chief operating officer and head of the structured finance business, and Michael Satz, ceo of the company's bond insurance business, recently resigned (BW, 5/10). The Merrill Lynch transaction, ACA ABS 2004-1, was originally marketed as a static pool offering that would issue notes backed by cash flows from a portfolio of asset-backeds. It was also intended to have a three-year substitution period, which would have allowed ACA to trade out of credits that performed poorly or racked up sharp gains. The new structure straitjackets the pool and does not allow for substitutions. "It's now a fully static deal," said one official familiar with the structure, although he stressed that the change was not necessarily related to the company's personnel changes. "The actual CDO team is still intact," he added. Cathy Bailey, director of marketing for ACA, declined to comment on the Rule 144a transaction. "This is not a credit or financial crisis for the company, it's a management issue. The rest of the team is still [here]," she said, referring to Muessel and Satz's departures. Chris Ricciardi, managing director and head of structured credit products at Merrill, declined to comment.
Still, one outside collateral manager speculated the change was made to appease potential investors who may have had concerns about buying an ACA deal given the high-profile personnel moves. "This is a people business and when people change, it raises questions. Change always [means] uncertainty," he said.