Redding Ridge prices $306.9 million; CIFC, CSAM issue euro CLOs; spreads improve

By Cristal Cody

Tupelo, Miss., April 22 – In new primary market action, Redding Ridge Asset Management, LLC priced $306.9 million of notes in a broadly syndicated CLO offering structured differently due to the impact from the coronavirus.

The deal was “structured differently than those deals put together before the Covid-19 recession,” S&P Global Ratings said in an analysis of the offering.

Redding Ridge’s CLO, which is the manager’s third new offering priced so far in 2020, featured risk mitigants including a short one-year reinvestment period, no classes rated below BBB and a deferrable AA class of notes.

The issue had lower leverage due to market prices for underlying assets, lower subordination, higher weighted average cost of debt and lower portfolio weighted average spread, S&P said.

Meanwhile, two managers closed on new euro-denominated CLOs.

CIFC Asset Management LLC priced €419.8 million of notes in its offering.

Credit Suisse Asset Management Ltd. tapped the primary market with a new €402.25 million broadly syndicated CLO.

Meanwhile, as of Friday, CLO AAA tranches were tracking 175 basis points tighter from March wides at Libor plus 225 bps, while BBB tranches were quoted 125 bps better at Libor plus 750 bps, JPMorgan analysts said in a note.

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