Commerzbank Sponsors €346.2M European CLO

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The London office of Commerzbank AG Debt Fund Management launched its third collateralized loan obligation ever on Friday, according to S&P Global; the deal has a targeted portfolio of €346.2 million.

Like Commerzbank’s previous two CLOs, the deal, dubbed Bosphorus CLO III, will be largely static with limited ability reinvest. During its two-year reinvestment period, new assets will only be acquired through proceeds from prepayments, optional redemptions and accelerations, according to a presale report published Friday by S&P Global. The manager does not have the discretion to sell assets and use proceeds to purchase new ones.

However, that is more leeway than Commerzbank had to manage the two predecessor deals: Bosphorus CLO II had only a one-year reinvestment period that concluded this month; and the first transaction from 2015 included no reinvestment options.

The pool of loans backing Bosphorus III will have a limited number of obligors (59), but has a diverse split of loans among industries: the top 10 sectors are all capped at 8.75% of the total portfolio size.

The CLO is the first for Commerzbank AG in nearly a year. It was arranged by Stifel, Nicolaus & Co.

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