Neuberger Berman sells $569.75 million CLO; June supply near $10 billion; pipeline steady

By Cristal Cody

Tupelo, Miss., June 20 – CLO issuance slowed over the week but remains robust with nearly $10 billion of deals already priced in June, according to market sources on Friday.

“CLO issuance has been $56 billion year to date, a pace that outstrips the record annual total [of $99 billion in 2007] by more than 20%,” Barclays analysts said in a note. “Middle-market CLO growth has also been solid.”

Neuberger Berman Fixed Income LLC bumped up the monthly total with a $569.75 million CLO transaction, according to a market source on Friday.

The CLO priced the AAA-rated notes at Libor plus 147 basis points.

Morgan Stanley & Co. LLC arranged the deal in its second CLO transaction of the week.

Covenant Credit Partners LLC priced the $527.5 million Covenant Credit Partners CLO I Ltd./Covenant Credit Partners CLO I LLC offering on Wednesday via Morgan Stanley, according to a market source. The CLO placed the AAA tranche at Libor plus 148 bps.

About $12.7 billion of CLOs are in the pipeline, a source said on Friday.

Neuberger Berman Fixed Income sold $569.75 million of notes due Aug. 15, 2025 in the Neuberger Berman CLO XVII, Ltd./Neuberger Berman CLO XVII, LLC transaction, according to a market source.

Morgan Stanley was the placement agent.

Neuberger Berman Fixed Income will manage the CLO, which is backed primarily by a revolving pool of broadly syndicated senior secured loans.

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