CLOs

Recent documentation tweaks that afford "excessive amounts of flexibility" to CLO managers can introduce "material, and even unquantifiable, risks" into transactions, according to the rating agency.

The Chicago-based corporate small-business lender and CLO management firm also reduced the cost in subordinate notes as it chose to maintain the existing reinvestment and maturity periods limiting the deal's shelf life.

The triple-A rated senior tranche of Ares European CLO X has a coupon of 85 basis points above Euribor, an indication that a four-month widening trend in Europe CLO spreads continues; the deal is expected to close in September.

The transaction, Shelter Growth CRE 2018-FL1, is backed by 22 properties with a total balance of $415.1 million; it is static, meaning the only new loans to be added to the trust will be "companion” interest in loans secured by existing assets.

The New York State Supreme Court has ruled that Sound Point is within its rights to enforce a 90-day noncompete agreement with a manager who joined GoldenTree two weeks after his resignation.

That's a departure from the firm's existing fund, which acquires controlling stakes in CLOs through "equity" holdings; the new fund will be advised by the same principals, Tom Majewski, Daniel W. Ko and Daniel M. Spinner.

Tikehau CLO IV B.V. will control €400 million (UA$466.5 million) in mostly European leveraged loans and high-yield bonds (with an allowance for up to 25% of non-euro-denominated assets), according to Fitch Ratings.

Unusually for a debut transaction, the $329.7 million M360 2018-CRE1 will be actively managed: For the first 12 months after the closing date, funds from repaid principal can be used to purchase new loans, subject to eligibility criteria.

When the transaction closes on July 23 it will be renamed Fortress Credit VSL VI; additional collateral, nearly half (48%) of the total, in fact, will come from another CLO, Fortress VI.

The €414.2 million CVC Cordatus Loan Fund XI will issue exchangeable shares for four classes of notes; this allows the fund to hold bonds without putting itself off-limits to U.S. banks.