Jefferies offers $409.5 million; NewStar closes third CLO, prices floaters at par

By Cristal Cody

Tupelo, Miss., Sept. 22 – Jefferies Finance LLC joined the deal pipeline with a $409.5 million CLO transaction in the works.

The transaction will be Jefferies Finance’s third CLO offering of the year.

In other activity on Tuesday, NewStar Financial, Inc. announced it closed on its previously reported $397.81 million NewStar Commercial Loan Funding 2015-2 LLC middle-market deal that priced on Sept. 3.

“This transaction represents our twelfth CLO to date and our third deal of the year, which brings our total issuance to over $5 billion,” Tim Conway, NewStar’s chief executive officer, said in the release.

All floating-rate notes priced at par, NewStar said.

The deal included a $23 million tranche of 3.46% class A-2 senior secured fixed-rate notes to meet specific investor demand, according to NewStar and Prospect News data.

The CLO placed about $228 million across six classes of notes due Aug. 25, 2027 in the Rule 144A and Regulation S private offering that was structured to comply with European risk retention regulations.

NewStar said it retained $70 million through a portion of the class E notes and the subordinated interests.

Wells Fargo Securities, LLC was the lead placement agent, and Capital One Securities was co-lead placement agent.

NewStar, a Boston-based middle-market commercial lender, priced three CLO transactions in 2014.

JFIN CLO 2015-II in pipeline

Jefferies Finance plans to price $409.5 million of notes due Oct. 17, 2026 in a CLO deal, according to a market source.

The JFIN CLO 2015-II Ltd./JFIN CLO 2015-II LLC transaction is expected to offer $2.5 million of class A-X amortizing senior secured floating-rate notes (Aaa/AAA), $245 million of class A-1 senior secured floating-rate notes (Aaa/AAA), $30 million of class B-1 senior secured floating-rate notes (Aa2) and $25 million of class B-2 senior secured fixed-rate notes (Aa2).

The deal also includes $25 million of class C secured deferrable floating-rate notes (A2), $23 million of class D secured deferrable floating-rate notes (Baa3), $20 million of class E secured deferrable floating-rate notes (Ba3) and $39 million of subordinated notes.

Jefferies LLC is the placement agent.

Apex Credit Partners LLC, a subsidiary of Jefferies Finance, will manage the CLO.

The CLO is non-callable until Oct. 17, 2017, and the reinvestment period ends Oct. 17, 2019.

The offering is backed primarily by broadly syndicated senior secured loans.

Jefferies Finance has priced two CLOs year to date.

The New York City-based commercial finance firm is co-owned by Jefferies Group LLC and Massachusetts Mutual Life Insurance Co.

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