Slaughter and May advised Aviva Life & Pensions UK Limited (Aviva) and its affiliates in relation to (i) the disposal of a portfolio of equity release mortgage loans secured over residential properties located in England, Wales, Scotland and Northern Ireland in respect of which Aviva Equity Release UK Limited is the original lender (the Portfolio); and (ii) the establishment of the Lifetime Mortgage Funding 1 PLC (LMF1) securitisation.
The transaction involved the sale of the Portfolio by Aviva to Aira Force Capital Optimization Strategies, LLC (the Retention Holder), who then immediately on-sold the Portfolio to LMF1. LMF1 issued £1,059,450,000.00 Equity Release Mortgage Backed Fixed Rate Notes due December 2090 under Rule 144A (the Notes), which are backed by receipts from the Portfolio.
The Notes comprised £465,410,000 Class A1 Notes (rated Aa2 (sf) (Moody’s)/ AA+ (sf) (ARC)), £65,320,000 Class A2 Notes (rated Aa3 (sf) (Moody’s)/ AA (sf) (ARC)), £121,720,000 Class A3 Notes (rated A3 (sf) (Moody’s)/ A+ (sf) (ARC)), £149,500,000.00 Class B0 Notes (rated Baa1 (sf) (Moody’s)/ A+ (sf) (ARC)), £49,000,000 Class B1 Notes (rated Baa2 (sf) (Moody’s)/ A+ (sf) (ARC)), £118,500,000 Class B2 Notes (rated Baa3 (sf) (Moody’s)/ BBB+ (sf) (ARC)), £80,000,000 Class B3 Notes (not rated) and £10,000,000 Class C Notes (not rated). The Notes (other than the Class B3 Notes and the Class C Notes) have been listed on the official list of the Irish Stock Exchange plc trading as Euronext Dublin.
Aviva purchased 100% of the Class A1 Notes and Class A2 Notes, the Retention Holder purchased 100% of the Class B3 and Class C Notes and the remainder of the Notes were publicly offered.
Under the securitisation structure, LMF1 has appointed Aviva Equity Release UK Limited as servicer in respect of the Portfolio. Legal title to the Portfolio remains with Aviva Equity Release UK Limited.
Citigroup Global Markets Limited acted as Arranger and Lead Manager.
Jasmin Kandola / Trainee