Trimaran, Regiment price CLOs; Fair Oaks buys Arrowpoint CLO 2014-3 equity, B notes

By Cristal Cody

Tupelo, Miss., Aug. 21 – Trimaran Advisors, LLC priced $464.75 million of notes in the Catamaran CLO 2014-2 Ltd./Catamaran CLO 2014-2 LLC transaction, according to a market source on Thursday.

The CLO sold $283.5 million of class A-1 floating-rate notes at Libor plus 151 basis points.

Credit Suisse Securities (USA) LLC was the placement agent.

The deal is Trimaran’s second CLO transaction of the year. The New York-based subsidiary of KCAP Financial, Inc. priced the $468 million Catamaran CLO 2014-1 Ltd./Catamaran CLO 2014-1 LLC offering in April.

Also in the primary market, Regiment Capital Management, LLC brought $407 million of notes in the Cavalry CLO IV, Ltd./Cavalry CLO IV, LLC deal, according to a market source.

Wells Fargo Securities LLC was the placement agent. Final pricing details were not available by press time.

Fair Oaks invests in CLO

In other CLO market activity, Fair Oaks Income Fund Ltd. said in a news release that master fund Fair Oaks Income Fund LP plans to acquire $20.5 million of equity notes and $4.3 million of B-rated notes from the Arrowpoint CLO 2014-3 Ltd./Arrowpoint CLO 2014-3 LLC vehicle.

The equity purchase represents 53% of the total equity in the deal.

Arrowpoint Asset Management LLC sold $415 million of notes in the transaction via Goldman Sachs & Co. on Friday.

The deal included $250 million of class A floating-rate notes (/AAA/); $48 million of class B floating-rate notes (/AA/); $32.4 million of class C deferrable floating-rate notes (/A/); $22 million of class D deferrable floating-rate notes (/BBB/); $17.2 million of class E deferrable floating-rate notes (/BB/); $7 million of class F deferrable floating-rate notes (/B/) and $38.4 million of subordinated notes in the equity tranche.

The CLO's current target portfolio has a principal value of $400 million across an expected 150 unique bank loan issuers, with an expected average exposure per issuer of about 0.7%, according to the statement from Fair Oaks Income Fund.

“We are pleased to have been able to ramp up the portfolio ahead of the original expectations,” Miguel Ramos Fuentenebro, co-founder of Fair Oaks Capital, said in the release. “The majority of the investments have been the result of sourcing work which started months ago. We are encouraged by the high completion rate to date and we still see a strong deal flow for the fund.”

About 93% of the underlying loans in the master fund's CLO investments are to U.S. issuers, 6% are to issuers based in the United Kingdom, Germany, France and the Netherlands and 1% are to other European issuers, according to the release.

Fair Oaks Income Fund said its investment policy involves exposure to U.S. and European CLOs or other vehicles and structures with portfolios that consist primarily of U.S. and European floating-rate senior secured loans.

The closed-ended investment company, located in New York and London, was formed in May by members of Stone Tower Capital LLC and GSO Capital Partners LP.

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