Canyon Advisors sells Volcker-compliant CLO; year-to-date U.S. deal volume near $7 billion

By Cristal Cody

Tupelo, Miss., March 31 – Canyon CLO Advisors LLC tapped the U.S. CLO primary market with a $451.1 million Volcker-compliant deal on Thursday.

The primary market has seen the bulk of the year’s deals come in March.

Canyon CLO Advisors’ new deal brings year-to-date CLO issuance to more than $6.8 billion, according to Prospect News data.

Canyon CLO Advisors priced $451.1 million of notes due April 15, 2028 in the CLO offering, according to a market source.

Canyon Capital CLO 2016-1, Ltd./Canyon Capital CLO 2016-1, LLC sold $247.5 million of class A-1 floating-rate notes at Libor plus 160 basis points and $45 million of class A-2 floating-rate notes at Libor plus 225 bps at the top of the capital structure.

Goldman Sachs & Co. was the placement agent.

Canyon CLO Advisors will manage the CLO and retain 5% of the fair market value of the notes to comply with U.S. risk retention regulations.

Proceeds from the deal will be used to purchase a portfolio of about $450 million of mostly senior secured leveraged loans.

The transaction is collateralized primarily by first-lien senior secured loans and is structured to comply with Volcker regulations by also not allowing the purchase of bonds, senior secured notes, letters of credit or securities that allow for conversion to equity.

Los Angeles-based Canyon CLO Advisors is a subsidiary of alternative asset manager Canyon Capital Advisors LLC.

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