Ballyrock prices $402.83 million CLO; PineBridge eyes euro reprint; loan outflows drop

By Cristal Cody

Tupelo, Miss., June 21 – Ballyrock Investment Advisors LLC priced $402.83 million of notes in the manager’s first CLO deal of 2019.

Ballyrock was last in the primary market in 2018 when it priced one new CLO deal and refinanced one vintage CLO transaction.

Meanwhile, CLO refinancing activity is expected to pick up with several issuers planning to reprice vintage dollar- and euro-denominated notes.

PineBridge Investments Europe Ltd. announced in a market release on Friday that it is “exploring” refinancing the vintage 2016 Euro-Galaxy V CLO BV deal on its next payment date of Aug. 10.

PineBridge Investments Europe sold €411.1 million of notes in the transaction that was issued Nov. 10, 2016. In the original offering, the CLO priced the AAA-rated tranche at Euribor plus 114 basis points.

As previously reported, Bain Capital Credit Ltd. plans to refinance $374.55 million of notes from the vintage 2015 Avery Point CLO VII, Ltd./Avery Point CLO VII, Corp. transaction in an offering expected to close June 27.

In addition, AXA Investment Managers, Inc. plans to price $414 million of notes in a July 15 refinancing of the vintage 2016 Allegro CLO IV, Ltd./Allegro CLO IV LLC deal.

Nearly €2 billion of vintage European CLOs have been refinanced this year, while about $18 billion of dollar-denominated CLOs have been refinanced, reset and or reissued year to date, according to market sources.

In the primary market, more than €10 billion of European CLOs and about $50 billion of dollar-denominated CLOs have priced year to date.

Elsewhere, leveraged loan outflows moderated to $380 million for the week ended Wednesday from a $620 million outflow a week earlier, according to a BofA Securities global research note released on Friday.

Fitch Ratings said in a release on Friday that the U.S. institutional leveraged loan default rate is forecast to inch up to 2% in 2020. The 2% forecast is up from a projected 1.5% rate in 2019 but still well below the 10.5% default rate in 2009, Fitch said.

Secondary volume thins

In other market action, secondary trading volume declined in high-grade and mezzanine CBO/CDO/CLO tranches on Thursday, Trace data shows.

About $98.47 million of non-investment-grade securities were traded in the previous session, compared to $164.38 million on Wednesday, $170.78 million on Tuesday and $39.64 million on Monday.

High-grade CBO/CDO/CLO trading volume moderated to $261.08 million in the previous session from $362.11 million on Wednesday and $306.64 million on Tuesday. High-grade trading volume totaled $128.43 million on Monday, according to Trace data.

The average trading price for high-grade securities dipped to 99.20 on Thursday from 99.50 on Wednesday, 99.30 on Tuesday and 99.60 on Monday, according to Trace data.

The average trading price on non-high-grade CBO/CDO/CLO improved to 87.70 on Thursday from an average 76.10 trading price on Wednesday. Earlier in the week, lower-rated issues traded at an average price of 95.50 on Monday and 91.70 on Tuesday.

Ballyrock CLO prices

Ballyrock Investment Advisors priced $402.83 million of notes due July 15, 2032 in the new CLO offering, according to a market source and a ratings report from Fitch Ratings on Friday.

Ballyrock CLO 2019-1 Ltd./Ballyrock CLO 2019-1 LLC sold $256 million of class A-1 floating-rate notes at Libor plus 136 bps and $46 million of class A-2 floating-rate notes at Libor plus 185 bps at the top of the capital stack.

J.P. Morgan Securities LLC was the placement agent.

The transaction is collateralized primarily by broadly syndicated senior secured corporate loans.

The investment management firm is based in Boston.

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