Benefit Street Partners CLO pricing emerges; Jamestown CLO on tap; secondary spreads wider

By Rebecca Melvin

New York, June 30 – Pricing emerged on another CLO deal on Tuesday, and another deal has launched for pricing in July.

Benefit Street Partners LLC priced a $512.6 million collateralized loan obligation transaction. The Benefit Street Partners VII Ltd./Benefit Street Partners CLO VII LLC sold $314.1 million of class A-1 floating-rate notes at Libor plus 149 basis points. J.P. Morgan Securities LLC was the placement agent. And Benefit Street Partners, the New York City-based credit investment arm of Providence Equity Partners LLC, will manage the CLO.

Meanwhile, 3i Debt Management U.S. LLC plans to price a new arbitrage cash flow CLO called Jamestown CLO VII Ltd./Corp., including a tranche of $322.5 million class A-1 notes (//AAA) at the top of the capital structure.

In the secondary market, activity has slowed over the past week, with bid-wanted-in-competition volumes “dialing down” to about $650 million by original face amount last week compared to more than $1 billion in the week earlier, according to BofA Merrill Lynch’s securitization weekly published June 26.

U.S. CLO 1.0 AAA tranches were marked most recently at a 150 bps discount margin for the year to date.

“The widening seen in this part of the capital structure leaked down the capital structure this week, with 1.0 AA to BB spreads widening by between 15 bps to 50 bps,” the BofA Merrill Lynch analysts wrote.

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