After a rush of refinancings, Anchorage issues its first new CLO of the year
Anchorage Capital is marketing its fifth new CLO of the year, but the fifth overall. The first four either refinanced existing collateralized loan obligations or transferred assets from older CLOs that were redeemed early.
Anchorage Capital CLO 2018-10 is backed by a $408.4 million broadly syndicated corporate loans, some of them acquired at issuance and some in the secondary market. The $5.2 billion-asset manager has otherwise filled its 2018 calendar with three re-issues of earlier vintage managed portfolios, a refinancing and its first-ever European CLO launch.
The 2018-10 transaction will issue five classes of fixed-rate and variable-rate notes totaling $337 million.
There are four tranches of Class A notes, three of them rated AAA by S&P Global Ratings. The $187 million Class A-1A bonds pay 120 basis points over Libor, the $35 million of Class A-1B-1 notes have a spread of 118 basis points, and $3.2 million of Class A-1B-2 notes pay a fixed rate of 4.19%.
The $26 million Class A-2 tranche is unrated.
Anchorage launched three new special-purpose vehicles earlier this year to repurpose loan assets that were pledged from a trio of its earlier-vintage deals. Anchorage chose to assign the loans from those transactions as collateral for new replacement securities between January and March — a time when leveraged loan supply was tight due to a large level of first-quarter new deal issuance ($31.9 billion) in the U.S. CLO market.
For one of the deals, Anchorage Capital CLO 1-R, the January re-issue represented a third refinancing of a 2012-vintage CLO.
Anchorage has also conducted a $499.6 million refinancing of its November 2014 Anchorage Capital CLO 5 transaction, and also sponsored its first European CLO, the €413 million Anchorage Capital Europe CLO 2018-1, in June.
The new 2018-10 transaction comes with a portfolio weighted average spread of 3.62% — above the three-month average of 3.44% for S&P rated CLOs — and has a two-year noncall period within a five-year reinvestment period.
The deal was placed through GreensLedge Capital Markets.