MT. LAUREL, NJ - PHH Corporation announced Jan. 27 the closing of a series of transactions resulting in the sale of certain fleet lease assets originated and serviced by PHH Vehicle Management Services Inc. (PHH VMS) to Fleet Leasing Receivables Trust (FLRT).
PHH VMS is the company's indirect wholly-owned Canadian fleet management business.
FLRT, in turn, issued and sold approximately C$363 million of senior Series 2010-1 Asset-Backed Notes backed by the PHH VMS fleet lease assets. FLRT is a Canadian special purpose trust established and administered by PHH VMS for the purpose of acquiring, disposing of and administering fleet leases and borrowing funds or issuing securities to finance the acquisition of such assets.
PHH intends to use most of the net proceeds from the issuance and related transactions to reduce outstandings under PHH's Amended and Restated Competitive Advance and Revolving Credit Agreement due in 2011.
"This is a very important transaction for our fleet management business and our clients," stated Jerome Selitto, president and chief executive officer of PHH. "As we previously discussed, the reestablishment of a Canadian lease securitization program has been a key part of our overall financing strategy to diversify PHH's funding sources and to maintain sufficient and appropriate liquidity to support our businesses while reducing borrowings under our Revolving Credit Facility."
PHH Arval President George Kilroy, stated: "We remain encouraged by the improvements we have seen over the last twelve months in asset backed securities markets, both in Canada and the U.S., and the demand for securities backed by PHH fleet assets."