Octane Completes $300 Million Asset-Backed Securitization to Drive Continued Growth

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Mar 05, 2024, 09:12 ET

AAA-Rating Follows Period of Strong Business Performance and Momentum

NEW YORK, March 5, 2024 /PRNewswire/ -- Octane^® (Octane Lending, Inc.^®), the fintech revolutionizing the buying experience for major recreational purchases, announced that it has closed a $300 million securitization ("OCTL 2024-1") collateralized by its fixed-rate installment powersports loans issued through its in-house lender, Roadrunner Financial^®, Inc.

OCTL 2024-1 issued six classes of fixed-rate notes: Class A-1, Class A-2, Class B, Class C, Class D, and Class E, which Standard & Poor's (S&P)* and Kroll Bond Rating Agency (KBRA)** rated as A-1+/K1+, AAA/AAA, AA/AA+, A/A+, BBB/BBB+, and BB/BB+ respectively, in a private offering pursuant to Rule 144A under the Securities Act of 1933, as amended. The senior class of notes in Octane's three asset-backed securitizations of 2023, OCTL 2023-1, OCTL 2023-2, and OCTL 2023-3, were also rated AAA by both S&P*** and KBRA**** upon issuance.

Truist Securities acted as lead book-running manager and structuring agent, with J.P. Morgan Securities, ATLAS SP Partners, and Mizuho Americas serving as joint bookrunners. Octane saw a high level of demand for its notes. Additionally, Octane expanded its investor base by attracting new investors through this issuance, while maintaining the support of existing institutional investors.

"We're excited we could take advantage of the favorable ABS market and close a successful transaction with the support of an ever-growing mix of esteemed partners," said Steven Fernald, Chief Financial Officer at Octane. "Our strong capital markets execution remains a key differentiator for Octane as we continue to grow our business in the months and years ahead."

This is Octane's tenth ABS transaction since launching the program in December 2019. The company has completed more than $3.3 billion of asset-backed securitizations to date. Last month, Octane announced the sale of $280M in whole loans to Yieldstreet, a leading private market investing platform. Octane's capital markets strategy also includes committed warehouse facilities.

This transaction comes on the heels of several exciting milestones. Octane surpassed $4B in aggregate originations last week, and in January, the company announced a strategic agreement with Kawasaki Motors Corp., U.S.A. The company closed 2023 GAAP net income profitable, while growing its number of applications by 96% and launching three new innovative products to help dealerships grow their businesses.

This press release does not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction.

*The full analysis for S&P's ratings, including any updates, which you should review and understand, is available on spglobal.com and can be accessed here.

**KBRA's ratings are subject to all of the terms and conditions set forth in the related report and KBRA's website, which you should review and understand, and can be accessed here.

***The full analysis for S&P's ratings for each of these transactions, including any updates, which you should review and understand, is available on spglobal.com and can be accessed here.

****KBRA's ratings for each of these transactions are subject to all of the terms and conditions set forth in the related report and KBRA's website, which you should review and understand, and can be accessed here.

About Octane:
Octane^® is revolutionizing recreational purchases by delivering a seamless, end-to-end digital buying experience. We connect people with their passions by combining cutting-edge technology and innovative risk strategies to make lifestyle purchases–like powersports vehicles, RVs, and outdoor power equipment–fast, easy, and accessible.

Octane adds value throughout the customer journey: inspiring enthusiasts with the Octane Media^™ editorial brands, including Cycle World^® and UTV Driver^®, instantly prequalifying consumers for financing online, routing customers to dealerships for an easy closing, and supporting customers throughout their loan with superior loan servicing.

Founded in 2014, we have more than 30 OEM and 4,000 dealer partners, and a team of over 500 in remote and hybrid roles. Visit www.octane.co.

Octane^® and Roadrunner Financial^® are registered service marks of Octane Lending, Inc.

Media Relations: Shannon O'Hara
VP of Communications & Brand at Octane
[email protected]

Investor Relations: Kartik Kothari
SVP of Corporate Development and Investor Relations at Octane
[email protected]

SOURCE Octane