KBRA assigns ratings to senior notes and MRPS issued by TTP

The fund is registered under the Investment Company Act of 1940 (the ’40 Act) and is a closed-end investment fund sponsored by Tortoise Capital Advisors, LLC. The fund had its Initial Public Offering in October 2011 and its shares are listed on the New York Stock Exchange under the symbol TTP. The fund invests primarily in equity securities of pipeline companies that transport natural gas, NGL, crude oil and refined products and, to a lesser extent, in other energy infrastructure companies.

Key credit considerations

The rating is driven primarily by TTP’s asset coverage, liquidity, and management experience. Since inception through November 2022, the fund has average senior and total asset coverage of 533% and 408%. Excluding one breach of asset coverage levels in March 2020 as a result of the market volatility experienced during the height of the COVID-19 pandemic and decline in crude oil prices, TTP has remained in compliance with the 1940 Act requirements.

Rating sensitivities

Changes in asset coverage can occur throughout the life of a transaction. These variations can often be driven by changes to the fund’s NAV, which can be due to actual or anticipated defaults and losses, as well as reassessment of the underlying asset values. The KBRA ratings process, however, incorporates a certain amount of tolerance to changes in asset coverage levels. A deterioration in asset coverage levels below ’40 Act requirements and the fund manager’s inability to liquidate assets and demonstrate intention to cure within the allowed 30 day period could impact the current ratings.

Read the article online at: https://www.worldpipelines.com/business-news/03012023/kbra-assigns-ratings-to-senior-notes-and-mrps-issued-by-ttp/