...- Focus Financial Partners (Focus) has announced that it will issue a $500 million new term loan in connection with its pending take-private transaction by Clayton, Dubilier & Rice LLC (CD&R). Funds managed by Stone Point Capital LLC (Stone Point) will retain a portion of their investment in Focus and provide new equity financing. - Wealth management industry consolidation and competition for registered investment advisor (RIA) acquisitions has increased in recent years, driving leverage higher for Focus as well as wealth management peers we rate. Furthermore, as a private firm, we no longer expect Focus to adhere to the 3.5x-4.5x leverage range it had committed to as a public company. - We assigned a 'B+' rating to the proposed term loan. - We lowered our rating on Focus to 'B+' from '##-', reflecting our expectation that it will maintain debt to EBITDA above 5.0x over the next 12 months. The rating also reflects the company's greater scale compared to peers, preferred interest in earnings...
