Chenavari prices €372.95 million CLO reset; heavy CLO refinancing supply dampens market

By Cristal Cody

Tupelo, Miss., Sept. 26 – Chenavari Credit Partners LLP sold €372.95 million of notes in a refinancing and reset of a vintage 2016 CLO.

More than €10 billion of vintage euro-denominated CLOs have been reset year to date, according to a BofA Merrill Lynch report.

In the U.S. market, more than $100 billion of vintage dollar-denominated CLOs have been refinanced and or reset year to date.

Heavy refinancing supply is putting a damper on the tone in the CLO market, Wells Fargo Securities, LLC analysts said in a note on Wednesday.

“On the technical side, the tone from CLO buyers and issuers ranged from resignation/frustration about heavy near-term supply, to optimism that a light at the end of the tunnel was visible, as reset/refi supply is likely to recede after Q1 2019,” the analysts said.

In its deal, Chenavari Credit Partners sold €372.95 million of notes in a refinancing and reset of the Toro European CLO 2 DAC transaction, according to a market source and a notice to noteholders on Wednesday.

The CLO priced the €248 million of class A-R floating-rate notes at par to yield Euribor plus 90 basis points.

Citigroup Global Markets Ltd. was the refinancing placement agent.

The maturity on the notes was extended by two years to Oct. 15, 2030.

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