Eaton Vance, Onex price; Highbridge preps deal; October volume light; secondary spreads soft

By Cristal Cody

Tupelo, Miss., Oct. 21 – Details emerged on new CLO issuance from Eaton Vance Management and Onex Credit Partners, LLC, while issuance overall remains light, according to market sources on Wednesday.

Eaton Vance Management priced $408.55 million of notes in its first CLO deal this year.

Onex Credit Partners tapped the primary market with a $508 million CLO transaction.

Coming up, Highbridge Principal Strategies LLC plans to price $468.5 million of notes in the firm’s second CLO transaction of the year.

“With seven business days left in the month, October issuance has almost outpaced the low September volume, at $4.4 billion month to date versus $4.9 billion for all of September,” Wells Fargo Securities, LLC analysts said in a research note on Wednesday.

U.S. dollar-denominated broadly syndicated CLO issuance totals $82.9 billion from 157 deals year to date, compared to $101.2 billion from 187 deals in the same period last year, the analysts said.

Year to date, U.S. CLO issuance totals more than $92 billion from 182 broadly syndicated, middle-market and refinancing transactions, according to Prospect News data.

In the U.S. secondary market, “spreads have continued to widen, particularly further down the capital stack,” the Wells Fargo analysts said. “While the senior notes have remained fairly range-bound, the BBB and BB 3.0 tranches are 20-70 points wider than the start of the year and 30-60 points wider than last month.”

CLO 3.0 AAA notes were quoted at Libor plus 155 basis points, while AA-rated notes traded at Libor plus 225 bps, according to the note. CLO BBB notes traded at Libor plus 460 bps and BBs were seen at Libor plus 800 bps in the secondary market.

Eaton Vance prints CLO

Eaton Vance Management priced $408.55 million of notes due Oct. 20, 2026 in the Eaton Vance CLO 2015-1 Ltd./Eaton Vance CLO 2015-1, LLC deal, according to a market source.

The CLO sold $246 million of class A senior secured floating-rate notes at Libor plus 145 bps in the AAA-rated tranche.

Wells Fargo Securities LLC was the placement agent.

Eaton Vance will manage the CLO.

The CLO has a non-call period that ends on Oct. 30, 2017. The reinvestment period ends on July 20, 2020.

The deal is backed primarily by broadly syndicated first-lien senior secured corporate loans.

Boston-based Eaton Vance Management, a subsidiary of Eaton Vance Corp., placed one CLO transaction in 2014.

Onex prices 2015-10 CLO

Onex Credit Partners priced $508 million of notes due Oct. 26, 2027 in a CLO offering structured to comply with European and U.S. risk retention regulations, according to parent company Onex Corp. and a market source.

OCP CLO 2015-10 Ltd./OCP CLO 2015-10 Corp. sold $315 million of class A-1 floating-rate notes at Libor plus 154 bps, $38 million of class A-2A floating-rate notes at Libor plus 230 bps and $27 million of 4.15% class A-2B fixed-rate notes at the top of the capital structure.

BofA Merrill Lynch was the placement agent.

Onex Credit Partners will manage the CLO.

The CLO is non-callable until Oct. 26, 2017. The reinvestment period ends Oct. 26, 2019.

The deal is backed primarily by broadly syndicated senior secured corporate loans.

Onex Credit Partners has priced three CLO deals year to date.

The Toronto-based private equity firm placed three CLO transactions in 2014.

Highbridge in pipeline

Coming up in the deal pipeline, Highbridge Principal Strategies plans to price $468.5 million of notes due Nov. 15, 2026 in the Highbridge Loan Management 7-2015 Ltd./Highbridge Loan Management 7-2015 LLC transaction, according to a market source.

The deal includes $310 million of class A floating-rate notes (/AAA/); $70 million of class B floating-rate notes (/AA/); $30.5 million of class C floating-rate notes (/A/); $27 million of class D floating-rate notes (/BBB/); $23.5 million of class E floating-rate notes (/BB/); $7.5 million of class F floating-rate notes (/B/) and $44.5 million of subordinated notes.

BNP Paribas Securities Corp. is the placement agent.

Highbridge Principal Strategies has priced one CLO in 2015.

The New York City-based affiliate of Highbridge Capital Management, LLC brought two CLO deals in 2014.

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