DBRS Assigns Rating of Pfd-3 (high) to Element Fleet’s Preferred Share Issuance, Series I, Trend Stb

DBRS, Inc. (DBRS) has today assigned a rating of Pfd-3 (high) to the C$100 million 5.75% Cumulative Five-Year Minimum Rate Reset Preferred Shares, Series I (the Preferred Shares) issued by Element Fleet Management Corp. (Element or the Company). The trend on the Preferred Shares is Stable. The proceeds from the Preferred Shares are expected to be used to fund the growth of Element’s business and for general corporate purposes.

The rating reflects Element’s strong franchise underpinned by its leading position in the North American commercial fleet management market, as well as top-tier positions in Mexico, Australia and New Zealand. Strong and predictable revenues underpin the earnings profile of the Company, which along with well-managed liquidity and appropriate levels of capital for the risk profile are foundations to the rating. The Company’s reliance on secured forms of wholesale funding and historical appetite for growth through acquisitions constrain the ratings.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The applicable methodologies are Global Methodology for Rating Finance Companies (October 2016) and DBRS Criteria: Preferred Shares and Hybrid Security Criteria for Corporate Issuers (December 2016), which can be found on our website under Methodologies.

The primary sources of information used for this rating include company documents and SNL Financial. DBRS considers the information available to it for the purposes of providing this rating was of satisfactory quality.