Neuberger Berman, GSO/Blackstone, Redding Ridge price CLOs; secondary paper softens

By Cristal Cody

Tupelo, Miss., April 16 – Three more managers have brought new CLO deals to the primary market.

Neuberger Berman Loan Advisers LLC priced a $504.38 million broadly syndicated CLO transaction that closed on Thursday.

The CLO has a short nine-month non-call period and a one-year reinvestment period.

GSO/Blackstone Debt Funds Management LLC also priced $501.7 million of notes in a new CLO offering set to close on Monday.

GSO/Blackstone’s new CLO has a one-year non-call period and a three-year reinvestment period.

In addition, Redding Ridge Asset Management, LLC priced a $446.5 million CLO that closes on Friday.

The deal has a one-year non-call period and a one-year reinvestment period.

Looking at the securitized secondary market, prices softened in the prior session.

On Wednesday, $683.75 million of high-grade CBO/CDO/CLO issues and $185.77 million of non-high-grade paper traded, according to Trace data.

High-grade CBO/CDO/CLO average prices fell to 88.40 on Wednesday from 92.30 on Tuesday and 92 on Monday.

Average prices for non-high-grade paper softened to 67.70 from 70.10 on Tuesday and 72.90 at the start of the week.

Secondary market volume totaled $573.54 million on Tuesday and $242.51 million on Monday, while non-high-grade volume reached $424.88 million on Tuesday and $76.28 million during Monday’s session.

Elsewhere, CLOs are seeing an increase in collateral affected by negative rating actions in response to the economic disruption caused by the coronavirus, according to a S&P Global Ratings report on Thursday.

“As of April 12, 2020, over 300 obligors found within U.S. BSL CLOs have had their ratings either lowered or placed on CreditWatch negative, or both,” S&P said. “Negative rating actions on corporate loan issuers are accumulating within U.S. BSL CLO collateral pools, which have now seen more than 21% of their collateral downgraded or placed on CreditWatch negative since early March.”

S&P said it expects actions on corporate ratings to continue for now but at a slower pace over the coming weeks.

“In response to the shifting risk profile of the collateral pools, we have started to see CreditWatch negative placements on some U.S. CLO subordinate and lower mezzanine tranche ratings,” S&P said. “As of April 12, 2020, 105 tranches across 73 S&P Global Ratings-rated U.S. BSL CLOs have ratings on CreditWatch negative.”

Neuberger Berman prices

Neuberger Berman Loan Advisers priced $504,375,000 of notes due April 20, 2033 in its new CLO offering, according to market sources.

Neuberger Berman Loan Advisers CLO 36, Ltd./Neuberger Berman Loan Advisers CLO 36, LLC sold $320 million of class A floating-rate notes at Libor plus 112 basis points in the AAA-rated tranche.

Wells Fargo Securities LLC was the placement agent.

The notes are backed primarily by broadly syndicated first-lien senior secured corporate loans.

Neuberger Berman is a Chicago-based investment management firm and affiliate of Neuberger Berman Group, LLC.

GSO/Blackstone prices

GSO/Blackstone Debt Funds Management priced $501.7 million of notes due April 20, 2031 in the Harriman Park CLO Ltd./Harriman Park CLO LLC deal, according to market sources.

The CLO sold $320 million of class A floating-rate notes at Libor plus 120 bps in the senior tranche.

Citigroup Global Markets Inc. was the placement agent.

The CLO is backed primarily by broadly syndicated first-lien senior secured corporate loans.

The New York City-based firm is a subsidiary of alternative asset manager GSO Capital Partners LP.

Redding Ridge sells CLO

Redding Ridge Asset Management priced $446.5 million of notes due April 15, 2031 in its broadly syndicated CLO transaction, according to market sources.

RR 9 Ltd./RR 9 LLC sold $250 million of class A-1FL floating-rate notes at Libor plus 270 bps at the top of the capital stack.

Natixis Securities Americas LLC was the placement agent.

The CLO is collateralized primarily by broadly syndicated first-lien senior secured loans.

The New York City-based asset management company was established in 2016 by Apollo Global Management, LLC.

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