KBRA Assigns Preliminary Ratings to ServiceMaster Funding LLC, Series 2020-1 Senior Secured Notes

NEW YORK--()--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three note classes of ServiceMaster Funding LLC, (the “Issuer”) a whole business securitization.

This transaction represents ServiceMaster’s first securitization. This transaction is structured as a “whole business securitization” in which ServiceMaster Opco Holdings LLC and certain of its affiliates will contribute substantially all of their revenue-generating assets to ServiceMaster Funding LLC and its subsidiaries and ServiceMaster of Canada Limited. The transaction collateral includes existing and future domestic and international franchise and regional distribution agreements, royalties and profits from company-operated locations, product and equipment sales, franchisee notes, other franchisee fees and intellectual property.

ServiceMaster Brands (“SMB”) is a leading provider of restoration and cleaning services to commercial and residential customers across all 50 states and 8 countries. SMB’s platform consists of its ServiceMaster Restore (restoration), ServiceMaster Clean (commercial cleaning), Merry Maids (residential cleaning), Furniture Medic (cabinet and furniture repair) and AmeriSpec (home inspection) businesses. SMB serves both residential and commercial customers in the US through a network of 2,119 North American locations and 1,922 franchisees as of September 30, 2020 (Q3 2020), with additional locations in 8 other countries. For the twelve months ending Q3 2020, the system generated system sales of approximately $2.6 billion. The system is approximately 99.7% franchised.

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Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the U.S. Information Disclosure Form located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the U.S. Information Disclosure Form referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

KBRA is a full-service credit rating agency registered as an NRSRO with the U.S. Securities and Exchange Commission. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider and is a certified Credit Rating Agency (CRA) with the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe is registered with ESMA as a CRA.

Contacts

Analytical

Xilun Chen, Senior Director (Lead Analyst)
+1 (646) 731-2431
xchen@kbra.com

Abby Barkwell, Director
+1 (646) 731-3304
abarkwell@kbra.com

Rosemary Kelley, Senior Managing Director (Rating Committee Chair)
+1 (646) 731-2337
rkelley@kbra.com

Shalin Rajpara, Senior Analyst
+1 (646) 731-3337
srajpara@kbra.com

Business Development

Ted Burbage, Managing Director
+1 (646) 731-3325
tburbage@kbra.com

Contacts

Analytical

Xilun Chen, Senior Director (Lead Analyst)
+1 (646) 731-2431
xchen@kbra.com

Abby Barkwell, Director
+1 (646) 731-3304
abarkwell@kbra.com

Rosemary Kelley, Senior Managing Director (Rating Committee Chair)
+1 (646) 731-2337
rkelley@kbra.com

Shalin Rajpara, Senior Analyst
+1 (646) 731-3337
srajpara@kbra.com

Business Development

Ted Burbage, Managing Director
+1 (646) 731-3325
tburbage@kbra.com