THL, Newfleet, DFG price new CLOs; deal pace picks up; AAAs flat, mezzanine spreads soften

By Cristal Cody

Eureka Springs, Ark., May 24 – Details emerged on new CLO transactions priced in May by THL Credit Advisors LLC, Newfleet Asset Management, LLC and DFG Investment Advisors, Inc.

THL Credit Advisors priced a $608.3 million CLO.

Newfleet Asset Management raised $356.3 million in a debut CLO transaction.

DFG Investment Advisors tapped the primary market with a $406 million offering.

Looking ahead, TCI Capital Management, LLC is in the deal pipeline with a $408.75 million CLO transaction.

The pace of issuance has risen in May with CLO volume of $17.9 billion year to date, according to a Wells Fargo Securities, LLC market note on Tuesday.

“With more than a month remaining in Q2, issuance for the quarter ($9.7 billion) has outpaced the first quarter of the year ($8.2 billion),” Wells Fargo analysts said in the note. “Year-to-date issuance is currently 38% of 2015 year-to-date issuance.”

CLO manager tiering remains pronounced in the primary market with AAA coupons ranging from Libor plus 155 basis points to Libor plus 185 bps, according to the report.

“The pickup in primary supply may have been a contributing factor to the softer levels in deep mezz last week, as BB spreads are 50 bps wider than late April and single-B spreads are 100 bps wider than recent tights [in secondary trading],” the Wells Fargo analysts said.

AAAs were quoted flat on the month in the secondary market at Libor plus 155 bps.

THL prices $608.3 million

THL Credit Advisors brought to market a $608.3 million CLO deal via deal arranger RBC Capital Markets, LLC, according to an informed source.

THL Credit Wind River 2016-1 CLO Ltd./THL Credit Wind River 2016-1 LLC priced $384 million of class A floating-rate notes at Libor plus 165 bps in the senior tranche.

THL Credit Senior Loan Strategies LLC will manage the CLO.

THL Credit Advisors priced two CLO transactions in 2015.

The alternative credit investment firm is based in Boston.

Newfleet brings debut CLO

Newfleet Asset Management priced $356.3 million of notes due April 20, 2028 in the Newfleet CLO 2016-1, Ltd. deal, according to details from a market source.

Newfleet CLO 2016-1, Ltd. sold $50 million of $227.5 million of class A senior secured floating-rate notes at Libor plus 185 bps at the top of the capital structure.

Wells Fargo Securities, LLC was the placement agent.

The CLO is backed by a broadly syndicated loan portfolio of non-investment-grade loans and other assets that the manager purchases from and trades in the primary and secondary markets.

Newfleet Asset Management is a Hartford, Conn.-based fixed income investment firm.

DFG places $406 million

DFG Investment Advisors priced $406 million of notes in its first CLO deal of 2016, according to a market source.

Vibrant CLO IV, Ltd. sold $236 million of class A-1 floating-rate notes at Libor plus 165 bps in the AAA-rated tranche.

Goldman Sachs & Co. arranged the deal.

DFG Investment Advisors will manage the CLO.

The New York-based asset management firm priced one new CLO offering and refinanced a vintage 2013 CLO deal in 2015.

TCI preps $408.75 million

TCI Capital Management plans to price $408.75 million of notes due July 17, 2028 in the TCI-Flatiron CLO 2016-1 Ltd./TCI-Flatiron CLO 2016-1 LLC transaction, according to a market source.

The deal includes $256 million of class A floating-rate notes (//AAA); $46 million of class B floating-rate notes; $22 million of class C floating-rate notes; $24 million of class D floating-rate notes; $20 million of class E floating-rate notes and $40.75 million of subordinated notes.

BofA Merrill Lynch will arrange the offering.

TCI Capital is the collateral manager, and NYL Investors LLC is the sub-adviser.

The CLO, collateralized primarily by broadly syndicated first-lien senior secured loans, will have a two-year non-call period and a 4½-year reinvestment period.

Proceeds from the deal will be used to purchase a portfolio of about $400 million of mostly senior secured leveraged loans.

The transaction is expected to close on June 29.

TCI Capital is a subsidiary of Saint Peter Port, Guernsey-based closed-ended investment company Tetragon Financial Group Ltd. and an affiliate of LCM Asset Management LLC.

© 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.