Octagon prices $511.5 million new CLO, refinances $523.8 million 2013 notes; AAAs tighten

By Cristal Cody

Tupelo, Miss., July 31 – Octagon Credit Investors, LLC priced its second new CLO transaction of the year and refinanced its sixth vintage CLO year to date.

The CLO manager sold $511.5 million of notes in the new transaction.

Octagon Credit Investors priced $523.8 million of notes in a refinancing and reset of a vintage 2013 deal.

CLO refinancing volume totals more than $100 billion year to date, according to market sources.

In the secondary market, spreads tightened on the senior portion of the capital stack, according to a BofA Merrill Lynch research note.

AAA spreads firmed 5 basis points to head out on Friday at Libor plus 110 bps. A-rated spreads tightened 5 bps to the Libor plus 235 bps area.

Octagon Credit Investors priced $511.5 million of notes due July 16, 2029 in the Octagon Investment Partners 32, Ltd./Octagon Investment Partners 32, LLC transaction, according to market sources.

The CLO sold $305 million of class A-1 senior secured floating-rate notes with a discount margin of Libor plus 118 bps.

Morgan Stanley & Co. LLC arranged the offering.

Meanwhile, Octagon Credit Investors sold $523.8 million of notes in a refinancing and reset of the vintage 2013 Octagon Investment Partners XV, Ltd./Octagon Investment Partners XV, LLC transaction, according to a market source and a notice of executed third supplemental indenture.

The CLO sold $278 million of class A-1A-R senior secured floating-rate notes at Libor plus 121 bps.

Citigroup Global Markets Inc. arranged the offering.

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