New York Life, BlueMountain, Oak Hill price CLOs; Cerberus affiliate in deal pipeline

By Cristal Cody

Tupelo, Miss., June 5 – CLO primary activity is finishing the first week of June off on a strong start with new issuance from BlueMountain Capital Management LLC, New York Life Insurance Co. and Oak Hill Advisors, LP, according to market sources on Thursday.

“They know they need to get it done while the market interest is there,” a source said.

BlueMountain Capital Management brought a $554.75 million CLO transaction and placed the AAA-rated tranche at Libor plus 145.5 basis points, according to an informed source.

A New York Life Insurance affiliate priced a $412.5 million deal on Thursday and placed the AAA tranche at Libor plus 140 bps, on the tight side of recent issuance, sources said.

Oak Hill Advisors was in the primary market with the $777 million OHA Credit Partners X, Ltd./OHA Credit Partners X, Inc. deal, according to a market source.

The OHA CLO priced the AAA notes at Libor plus 147 bps.

Coming up in the pipeline, an affiliate of middle market lender Cerberus Capital Management, LP plans to price a $145 million CLO transaction, according to a market source.

BlueMountain brings CLO

BlueMountain Capital Management sold $554.75 million of notes due July 20, 2026 in the BlueMountain CLO 2014-2 Ltd./BlueMountain CLO 2014-2 LLC deal, according to an informed source.

The CLO priced $340 million of class A floating-rate notes (/AAA/) at Libor plus 145.5 bps; $43.05 million of class B-1 floating-rate notes (/AA/) at Libor plus 200 bps; $17 million of 4.085% class B-2 fixed-rate notes (/AA/); $45.25 million of class C deferrable floating-rate notes (/A/) at Libor plus 285 bps; $27.3 million of class D deferrable floating-rate notes (/BBB/) at Libor plus 345 bps; $22.25 million of class E deferrable floating-rate notes (/BB/) at Libor plus 495 bps; $16.3 million of class F deferrable floating-rate notes (/B/) at Libor plus 550 bps and $43.6 million of subordinated notes.

J.P. Morgan Securities LLC arranged the offering.

BlueMountain Capital Management will manage the CLO.

The transaction is backed by broadly syndicated senior secured corporate loans.

BlueMountain Capital Management was last in the primary market on March 24 with the $513.23 million BlueMountain CLO 2014-1 Ltd./BlueMountain CLO 2014-1 LLC deal.

The New York City-based private investment firm priced three CLO transactions in 2013.

Flatiron CLO prices

A New York Life Insurance affiliate priced $412.5 million of notes due July 17, 2026 in the CLO offering on Thursday, according to market sources.

Flatiron CLO 2014-1 Ltd./ Flatiron CLO 2014-1 LLC sold $256 million of class A-1 floating-rate notes (//AAA) at Libor plus 140 bps; $45.5 million of class A-2 floating-rate notes at Libor plus 190 bps; $21 million of class B floating-rate notes at Libor plus 285 bps; $25.5 million of class C floating-rate notes at Libor plus 330 bps; $18.5 million of class D floating-rate notes at Libor plus 500 bps and $46 million of subordinated notes.

BofA Merrill Lynch arranged the transaction.

NYL Investors LLC will manage the CLO.

The deal is backed primarily by senior secured corporate loans.

Proceeds will be used to repay interim financing and to purchase assets to reach a target portfolio of about $400 million of leveraged loans.

New York Life Insurance affiliate New York Life Investment Management LLC brought the $409.75 million Flatiron CLO 2013-1 Ltd./ Flatiron CLO 2013-1 LLC deal in November.

Oak Hill prices $777 million

Oak Hill Advisors priced a $777 million CLO deal via Morgan Stanley & Co. LLC, according to a market source.

OHA Credit Partners X sold $4 million of class X floating-rate notes (//AAA) at Libor plus 100 bps; $463.5 million of class A floating-rate notes (//AAA) at Libor plus 147 bps; $93.75 million of class B floating-rate notes at Libor plus 210 bps; $37.75 million of class C floating-rate notes at Libor plus 310 bps; $49 million of class D floating-rate notes at Libor plus 340 bps; $49.75 million of class E floating-rate notes at Libor plus 515 bps; $6.25 million of class F floating-rate notes at Libor plus 538 bps and $73 million of subordinated notes.

Oak Hill Advisors will manage the CLO, which is backed primarily by first lien senior secured loans.

The notes are due in 2026.

Proceeds from the deal will be used to purchase a portfolio of about $750 million of mostly senior secured leveraged loans.

Oak Hill Advisors, a New York City-based investment firm, brought two CLO transactions in 2013.

Cerberus CLO in pipeline

An affiliate of middle market lender Cerberus Capital Management plans to price a $145 million CLO offering, according to a market source.

The Cerberus AUS Levered II LP deal includes $35 million of class A-R loans (Aaa//), $30 million of class A-T loans (Aaa//) and $80 million of limited partnership interests.

The loans are due June 2022 and have a five-year weighted average life.

Natixis Securities Americas LLC is the underwriter.

Cerberus affiliate CAL II GP, LLC will manage the CLO.

The CLO portfolio consists primarily of middle market first lien senior secured loans and eligible investments.

Cerberus Capital Management is a New York City-based investment firm.

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