Brisk April CLO activity pushes issuance ahead of record 2018 pace
Five new-issue CLOs priced on Thursday, pushing April’s total volume for primary collateralized loan obligations to $13.8 billion and pacing the year-to-date market totals ahead of the record 2018 issuance.
According to JPMorgan, new deals priced from Eaton Vance Management, Credit Suisse Asset Management, LCM Asset Management (a subsidiary of Tetragon Financial Group), PGIM and middle-market direct lender Owl Rock Capital Advisors.
The $13.8 billion in April volume through Thursday tops the year’s previous high monthly output of $13.2 billion in new deals in February. The $43 billion in new deals so far is pacing 7% ahead of 2018, which set a record post-crisis primary volume of $128.1 billion.
U.S. CLO refinancings total $12.5 billion year-to-date.
Eaton’s deal, the $405 million Eaton Vance CLO 2019-1, was placed via Wells Fargo. The deal’s coupon was expected to be 130 basis points over Libor, according to presale reports from Fitch Ratings and Moody’s Investors Service – giving Eaton the tightest triple-A spread for deals pricing Thursday.
Credit Suisse priced the $801 million Madison Park Funding XXXV through Bank of America, with presale reports previously listed the price at 133 basis points. LCM 29 CLO, sized at $404 million, also had a 133 basis point spread via Natixis.
LCM, which managed 17 CLOs totaling $8.3 billion through the end of March, recently closed on its LCM 30 CLO transaction, as well, according to ratings agency reports. That $404 million deal was assigned ratings Thursday by Moody’s and S&P Global Ratings.
JPMorgan also noted the closing of PGIM’s $404 million Dryden 72 transaction, as well as the $597 million Owl Rock CLO 1, a debut middle-market CLO issue from Owl Rock Capital Advisors. No pricing information was available on the deals, and no presale reports have been published on either portfolio.
Brigade Capital Management also closed on a refinancing of its 2016-vintage Battalion CLO X deal, via Morgan Stanley, according to JPMorgan.