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Eaton Vance preps firm’s first CLO of year; BB, B tranches remain soft in secondary trading
By Cristal Cody
Tupelo, Miss., Oct. 1 – Market activity is picking up in the CLO market with a new deal priced and another in the pipeline, according to market sources on Thursday.
Ares Management LLC sold $707 million of notes in the Ares XXXVII CLO, Ltd./Ares XXXVII CLO, LLC deal via Goldman Sachs & Co. Final pricing details were not available by press time.
Looking to issuance coming up, Eaton Vance Management is marketing a $408.23 million CLO in its first transaction of the year.
CLO volume is expected to stay light over October following a quiet September that saw about $4.6 billion of volume from 10 deals, according to market sources and Prospect News data.
“September was the lowest issuance month since July 2013,” Wells Fargo Securities, LLC analysts said in a market note on Thursday. “CLO monthly issuance has declined each month since June, but we expect seasonal pressures will push issuers to attempt to price deals before year-end.”
In the secondary market, BB- and B-rated CLO notes continue to remain soft.
“The BB and B tranches are currently trading at their widest point in the past 52 weeks, and BBB spreads look tight when compared to BB levels,” the Wells Fargo analysts said.
BB and B notes were quoted 25 basis points to 50 bps wider earlier in the week.
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