OREANDA-NEWS. Fitch Ratings expects to assign a 'BBB' rating to Affiliated Managers Group Inc.'s (AMG) \$350 million senior unsecured notes, due Aug. 1, 2025. The notes will rank pari passu with AMG's existing and any future senior unsecured debt. Proceeds from the issuance are to be used to reduce a portion of revolver borrowings and for general corporate purposes.

KEY RATING DRIVERS

Given that the proceeds from the new issuance will be used to repay outstanding borrowings under the revolving credit facility, Fitch does not envision there being a material impact on the company's leverage levels as a result of the issuance. At Dec. 31, 2014, AMG had \$605 million outstanding under its revolving credit facility.

RATING SENSITIVITIES

The expected rating assigned to the proposed unsecured debt is equalized with AMG's other senior unsecured debt that is aligned with its Long-term Issuer Default Rating (IDR) of 'BBB' with a Positive Outlook. The rating of the debt is sensitive to any change in AMG's Long-term IDR. AMG's Long-term IDR could be upgraded if AMG is able to maintain leverage below its long-term articulated leverage target of 2.0x, on a sustained basis, while maintaining solid investment performance at the affiliate level.

Fitch expects that AMG will remain disciplined in its future acquisition strategy with regard to use of debt, pricing multiples and transaction size. Aggressive acquisitions funded by increased debt levels, sustained deterioration in leverage or interest coverage ratios beyond management's articulated target range, prolonged investment underperformance at major affiliates, significant liquidity strains caused by affiliate equity puts, and/or unexpected operational losses or significant net outflows could lead to negative rating action.

AMG is a global asset management company with equity investments in leading boutique investment management firms. As of Dec. 31, 2014, the aggregate AUM of AMG's affiliates were approximately \$626 billion (pro forma for a pending investment) in more than 400 investment products across a broad range of investment styles, asset classes and distribution channels.

Fitch currently rates AMG as follows:

Affiliated Managers Group, Inc.
--Long-term IDR 'BBB';
--Senior bank credit facility 'BBB';
--Senior unsecured debt 'BBB'.

AMG Capital Trust II
--Trust preferred securities 'BB'.

The Rating Outlook is Positive.