The European CLO market was hot last week with two U.S. fund managers announcing the close of their latest vehicles from management arms across the pond. GSC Group announced the completion of fundraising on its latest CDO, GSC European CDO V, a 300 million cash-flow CLO consisting mainly of European senior secured leveraged loans. The fund will target a portfolio of 90% senior and 10% subordinated debt and will invest primarily in private equity-backed transactions, GSC said. Unlike standard CLOs, the vehicle will utilize a lightly levered structure less sensitive to changes in the default rates and margins of its underlying assets, GSC said. Citigroup priced the transaction. Peter Firth, managing director, will be the principal portfolio manager of the vehicle. The collateralized corporate debt group will manage the fund. The group currently manages $7.1 billion in CDO assets, 30% of which are European assets. Ares Management also closed its first European structured debt investment vehicle, Ares Euro CLO I B.V, a 356 million European CLO fund managed by Ares' capital markets group. Deutsche Bank served as underwriter as well as structuring and distribution agent for the fund. This is Ares' 15th cash-flow CLO since its inception.
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