S&P drops Marsico to CCC+

Standard & Poor's said it lowered the counterparty credit rating on Marsico Parent Co. LLC to CCC+ from B-, its senior secured bank term loan rating to CCC+ from B and its $600 million subordinated notes due 2016 to CCC- from CCC, and revised the recovery rating on the senior secured issuance to 4 from 2.

The outlook is negative.

"The ratings actions are prompted by the sharp drop in the company's [assets under management], which has adversely affected Marsico's financial capacity to service its heavy debt burden," S&P analyst Charles Rauch said in a statement.

"Most of the drop in AUM occurred during the past eight to nine months when the global equity markets went into a free fall and the company suffered from net redemptions. Among rated asset managers, Marsico is particularly vulnerable to declining stock prices because it is exclusively a growth equity shop," Rauch noted.

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