Acis, NXT price new CLOs; PGIM taps Europe; Octagon refinances; CLO spreads unchanged

By Cristal Cody

Tupelo, Miss., March 27 – New CLO issuance is picking up, while refinancing action continues at a heavy pace, according to market sources on Monday.

Acis Capital Management, LP priced a $405.5 million CLO, which included a senior equity tranche that priced at Libor plus 775 basis points.

NXT Capital LLC subsidiary NXT Capital Investment Advisers LLC placed $406.35 million of notes in a new middle-market transaction.

In European CLO primary action, PGIM Ltd. brought a €416.38 million new CLO to market.

Looking at new refianncings, Octagon Credit Investors, LLC refinanced $453.75 million of notes from a vintage 2014 CLO.

“One question we have been receiving is how much longer the refi wave can last,” J.P. Morgan Securities LLC analysts said in a note.

In the first quarter of 2016, the monthly average of refi/reset volume was 24, and year to date, the monthly run rate since February has been about 40 deals, according to JPMorgan.

“Assuming the market remains firm, this 40 monthly run rate in 2017 persists, and a CLO can only be refinanced once, that would bring us to about August or September until the entire post-crisis U.S. CLO market is refinanced,” the analysts said. “So far, 26% of the Q2-Q4 2013 CLOs and 42% of 2014 vintage CLOs have been refinanced/repriced/called.”

In the secondary market, CLO spreads ended Friday flat on the week, according to a BofA Merrill Lynch note.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.