Credit Suisse Asset Management opens February with $746 million CLO; pipeline active

By Cristal Cody

Tupelo, Miss., Feb. 3 - Primary action is expected in the collateralized loan obligation market over the week after Credit Suisse Asset Management, LLC opened the month with a $746 million CLO deal on Monday, according to informed sources.

Late in the previous week, ICG Debt Advisors LLC priced a $371.17 million CLO transaction, a source said.

The CLO deal pipeline sits at about $14 billion, according to a market source.

With no expected near-term clarity about bank ownership of CLOs, CLO managers are moving forward with issuance, sources said.

The Volcker Rule, issued on Dec. 10 as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, prohibits banks from owning CLOs that hold covered funds, with an exception for securitizations of loans that do not own securities. The rule is set to take effect in 2015.

"Many CLOs would be considered 'covered funds,' and banks would not be able to own them," according to a Wells Fargo Securities, LLC report on Monday.

CSAM raises $746 million

Credit Suisse Asset Management priced the $746 million Madison Park Funding XII Ltd./Madison Park Funding XII LLC transaction on Monday, according to an informed source.

BofA Merrill Lynch was the placement agent.

Final pricing terms were not available by press time.

Credit Suisse Asset Management, a unit of Credit Suisse Group AG, was most recently in the primary market with the $521.5 million Madison Park Funding XI, Ltd./Madison Park Funding XI, LLC deal that closed on Sept. 19.

ICG AAAs at 115 bps spread

ICG Debt Advisors sold $371.17 million of notes due 2026 in the ICG US CLO 2014-1, Ltd./ICG US CLO 2014-1, LLC deal via Citigroup Global Markets Inc., an informed source said.

ICG US CLO 2014-1 sold $212.25 million of class A-1 senior secured floating-rate notes (Aaa) at Libor plus 115 bps and $55.75 million of class A-2 senior secured floating-rate notes at Libor plus 175 bps at the top of the capital structure.

The CLO also priced $20.5 million of class B senior secured deferrable floating-rate notes at Libor plus 273 bps; $19 million of class C senior secured deferrable floating-rate notes at Libor plus 325 bps; $15.25 million of class D senior secured deferrable floating-rate notes at Libor plus 450 bps; $7.5 million of class E senior secured deferrable floating-rate notes at Libor plus 575 bps and $40.92 million of subordinated notes.

ICG Debt Advisors will manage the CLO, which is backed by a portfolio of broadly syndicated senior secured corporate loans.

ICG Debt Advisors is a subsidiary of ICG Inc., which is a wholly owned subsidiary of ICG FMC Ltd. London-based Intermediate Capital Group plc is the parent company.

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