Ares prices $511.23 million CLO; KKR places $415.6 million deal; secondary ‘slow’

By Cristal Cody

Tupelo, Miss., Dec. 4 – U.S. CLO issuance climbed to more than $124 billion year to date following offerings from Ares Management LLC and KKR Financial Advisors II, LLC, while secondary action seems to be on the wane, according to data compiled by Prospect News and market sources on Thursday.

Ares Management sold $511.23 million of notes in its CLO deal and placed the AAA slice at Libor plus 148 basis points, a source said.

KKR Financial Advisors II brought a $415.6 million CLO transaction, according to a market source. The CLO priced the AAA tranche of notes at Libor plus 160 bps.

In the CLO secondary space, “it’s been slow,” a trader said late afternoon. “There’s little to nothing going on. The market’s wide right now.”

Ares brings XXXII CLO

Ares Management sold $511.23 million of notes due Nov. 15, 2025 in the CLO offering via Deutsche Bank Securities Inc., according to a market source.

Ares XXXII CLO Ltd./Ares XXXII CLO LLC priced $309 million of class A-1 senior floating-rate notes (Aaa/AAA/) at Libor plus 148 bps at the top of the capital structure. Lower in the tranches, the CLO sold $11.5 million of class E deferrable floating-rate notes (B2) at Libor plus 655 bps.

Ares CLO Management XXXII, LP will manage the CLO.

Ares Management previously was in the primary market with the $1.26 billion Ares XXXI CLO Ltd./Ares XXXI CLO LLC deal on July 30.

The alternative asset management firm is based in Los Angeles.

KKR prices $415.6 million

CLO manager KKR Financial Advisors II priced $415.6 million of notes due Dec. 15, 2025 in the KKR CLO 10 Ltd./KKR CLO 10 LLC transaction, according to a market source.

The CLO sold $247 million of class A senior secured floating-rate notes (Aaa//AAA) at Libor plus 160 bps at the top of the capital stack. At the bottom of the structure, the CLO priced $19 million of class E senior secured deferrable floating-rate notes (/BB/) at Libor plus 500 bps.

BNP Paribas Securities Corp. was the placement agent.

KKR Financial Advisors was previously in the primary market on Aug. 7 with the $518 million KKR CLO 9 Ltd./KKR CLO 9 LLC transaction.

The firm is a subsidiary of KKR Asset Management, LLC.

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