Clipper Acquisitions Corp.

The stable outlook reflects S&P Global Ratings' expectation that Clipper will operate with debt to adjusted EBITDA of approximately 2.0x during the next 18-24 months, while investment performance and organic flows will not meaningly deteriorate, despite higher volatility in the financial markets. We could lower the ratings if leverage rises above 3x. Alternatively, we could lower the ratings if investment performance deteriorates meaningfully or if the company exhibits continued net outflows. We could raise the ratings if we believe the company has the commitment to maintain leverage comfortably below 2x on a sustained basis while investment performance and net flows remain strong. The average AUM will remain relatively stable or modestly grow in 2020 and 2021. The average fee rates

...AUM has grown by almost 70% since 2013. Clipper Acquisitions Corp. has been able to grow AUM significantly over time as a result of meaningful net inflows (despite some volatility in 2018 and the beginning of 2020) and market performance. The business remains largely concentrated in fixed-income strategies. As of March 31, 2020, more than 85% of AUM was in fixed-income strategies, and the MetWest Total Return Bond Fund represented almost 40% of total AUM. The company has no near-term maturities and a sizable cash balance. Clipper's debt matures in 2024, and the company's cash balance is significantly above projected cash outlays....

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