Lovells is taking on its third whole business securitisation, advising the lead arrangers on a £65m deal backed by the income from the ferry service provided by the Isle of Man Steam Packet Company. NM Rothschild & Sons and ABN Amro are joint lead managers on the deal and Lovells won the work through its longstanding relationship with Rothschild. The deal is a coup for the firm as it has not handled a huge amount of work for ABN, and it hopes the deal will strengthen its relationship with the bank. Steam Packet, which has been running since 1830, operates a daily service between the UK, the Isle of Man and Northern Ireland. According to lead partner on the deal Brian Carne, the deal is unusual because it is a pure cash flow deal. "A lot of whole business deals are based on assets such as the value of property," he said. "But in this case the bonds are repaid from cash generated from the business, as the assets would not be sufficient to pay them back." Under the terms of the deal, Steam Packet will issue £40m of fixed rate notes due in 2010 and £25m of floating rate notes due in 2010. The notes will be rated BBB by Standard & Poor's. Whole business securitisations in the UK have been under threat from the Government's proposed changes to the administration process. However, because Steam Packet is located on the Isle of Man the transaction has not been affected by the uncertainty and the deal is progressing smoothly. Working alongside Carne is corporate partner Andrew Carey and shipping partner David Moss. Lovells also started off advising the issuer, but halfway through the transaction Richards Butler was brought in to advise its long-term client, Steam Packet's parent group, Sea Containers. In 2001 Lovells advised Rank Hovis Mcdougall (RHM) and Doughty Hanson as equity investor when RHM securitised its Foodbrands+ Group. It also advised Dresdner Bank as lead manager on the whole business securitisation of Avebury Properties in 2000.