Fitch Places 10 Classes of Ares High Yield CSO II PLC on Watch Negative

CHICAGO--(Business Wire)--
Fitch Ratings has placed 10 classes of notes issued by Ares High Yield CSO II
PLC (Ares CSO II) on Rating Watch Negative as follows:

--$20,000,000 series B-1 notes 'AAA';

--$45,500,000 series 2B-1 notes 'AAA';

--EUR25,000,000 series B-2 notes 'AAA';

--JPY500,000,000 series 2B-2 notes 'AAA';

--$5,000,000 series B-3 notes 'AAA';

--$3,000,000 series C notes 'AA+';

--$5,000,000 series 2C notes 'AA+';

--$4,000,000 series D notes 'AA';

--$10,500,000 series 2D-1 notes 'AA';

--JPY300,000,000 series 2D-2 notes 'AA'.

In addition, Fitch has removed the Stable Rating Outlooks on the class B-1,
2B-1, B-2, 2B-2 and B-3 notes and removed the Negative Rating Outlooks on the
class C, 2C, D, 2D-1 and 2D-2 notes.

The following six classes issued by Ares CSO II remain on Watch Negative:

--$2,000,000 series E-1 notes 'A+';

--$4,500,000 series 2E-1 notes 'A+';

--JPY1,000,000,000 series E-2 notes 'A+';

--JPY100,000,000 series 2E-2 notes 'A+';

--$11,700,000 series G notes 'BBB+';

--$11,070,000 series 2G notes 'BBB+'.

The Negative Watch status reflects Fitch's view that the credit risk of the
notes is worsening given the deterioration in the reference portfolio. Since the
previous rating action in February 2009, the notes have suffered a 2.3% decrease
in credit enhancement due to trading losses and exposure to credit events on
Equistar Chemical and Smurfit-Stone Container. In addition, 48.4% of the
reference portfolio has experienced negative credit migration since February
2009, including 7.1% with ratings downgraded to 'D'. Currently, 32.8% of the
portfolio has a Negative Outlook, with an additional 6.1% on Watch Negative.

Assets with a Fitch derived rating in the 'CCC' bucket or below comprise 34.9%
of the portfolio, with 7.1% rated 'D'. This compares with credit enhancement
levels of 25% for the series B-1 notes and 15.8% for the series G notes.

Ares CSO II is a synthetic collateralized debt obligation (CDO) that matures in
September 2010 and is managed by Ares Management, LLC. Ares CSO II's portfolio
is comprised of primarily non-investment grade corporate obligations. Ares CSO
II gains access to the credit risk of the 74 obligors in the portfolio via a
credit default swap with Deutsche Bank AG London (rated 'F1+/AA-' and on Watch
Negative by Fitch), as swap counterparty.

This transaction was reviewed in accordance with Fitch's current criteria for
corporate CDOs. Fitch's revised criteria report for rating corporate CDOs was
released on April 30, 2008.

Fitch's rating definitions and the terms of use of such ratings are available on
the agency's public site, www.fitchratings.com. Published ratings, criteria and
methodologies are available from this site, at all times. Fitch's code of
conduct, confidentiality, conflicts of interest, affiliate firewall, compliance
and other relevant policies and procedures are also available from the 'Code of
Conduct' section of this site.

Fitch Ratings
Derek Miller, +1-312-368-2076 (Chicago)
Kevin Kendra, +1-212-908-0760 (New York)
Media Relations:
Sandro Scenga, +1-212-908-0278 (New York)
sandro.scenga@fitchratings.com

Copyright Business Wire 2009