By Cristal Cody
Tupelo, Miss., April 24 – NewStar Financial, Inc. sold $411.74 million of notes in a refinancing and reset of a middle-market collateralized loan obligation transaction, according to a market source and a notice of revised proposed first supplemental indenture on Monday.
The NewStar Fairfield Fund CLO Ltd. deal was previously brought to the primary market in 2015 by Fifth Street CLO Management LLC under the CLO vehicle, Fifth Street SLF II Ltd./Fifth Street SLF II LLC.
NewStar Fairfield Fund CLO priced $195 million of class A-1-N senior secured floating-rate notes at Libor plus 127 basis points and $71.6 million of class A-2-N senior secured floating-rate notes at Libor plus 175 bps.
The CLO sold $14 million of class B-1-N senior secured deferrable floating-rate notes at Libor plus 225 bps; $20 million of 5.18% class B-2-N senior secured deferrable fixed-rate notes; $21.8 million of class C-N secured deferrable floating-rate notes at Libor plus 358 bps; $22.8 million of class D-N secured deferrable floating-rate notes at Libor plus 738 bps and $67.04 million of subordinated notes.
Natixis Securities Americas LLC arranged the offering.
The maturity was extended to April 29, 2030 from the original Sept. 29, 2027 due date.
The reset CLO has a two-year non-call period and a five-year reinvestment period.
The original $416.6 million CLO was issued Sept. 29, 2015 and sold $20 million of class A-1R revolving notes at Libor plus 192 bps, $175.8 million of class A-1T floating-rate notes at Libor plus 192 bps, $31 million of 3.53% class A-1F fixed-rate notes and $40.6 million of class A-2 floating-rate notes at Libor plus 281 bps.
The CLO also had priced $39.6 million of class B deferrable floating-rate notes at Libor plus 372 bps, $22.3 million of class C deferrable floating-rate notes at Libor plus 485 bps, $35.2 million of class D deferrable floating-rate notes at Libor plus 730 bps and $52.1 million of subordinated notes.
Proceeds will be used to redeem the original notes.
The deal is collateralized by small and medium enterprise loans.
Boston-based NewStar acquired the Fifth Street CLO Management firm in 2017.
| Issuer: | NewStar Fairfield Fund CLO Ltd.
|
| Amount: | $411.74 million refinancing
|
| Securities: | Fixed-rate, floating-rate and subordinated notes
|
| Maturity: | April 29, 2030
|
| Structure: | Cash flow SME CLO
|
| Refinancing agent: | Natixis Securities Americas LLC
|
| Manager: | NewStar Financial, Inc.
|
| Call feature: | Two years
|
| Settlement date: | April 30
|
|
|
| Class A-1-N notes
|
| Amount: | $195 million
|
| Securities: | Senior secured floating-rate notes
|
| Coupon: | Libor plus 127 bps
|
| Ratings: | S&P: AAA
|
| Fitch: AAA expected
|
|
|
| Class A-2-N notes
|
| Amount: | $71.6 million
|
| Securities: | Senior secured floating-rate notes
|
| Coupon: | Libor plus 175 bps
|
| Rating: | Fitch: AA expected
|
|
|
| Class B-1-N notes
|
| Amount: | $14 million
|
| Securities: | Senior secured deferrable floating-rate notes
|
| Coupon: | Libor plus 225 bps
|
| Rating: | Fitch: A- expected
|
|
|
| Class B-2-N notes
|
| Amount: | $20 million
|
| Securities: | Senior secured deferrable fixed-rate notes
|
| Coupon: | 5.18%
|
| Rating: | Fitch: A- expected
|
|
|
| Class C-N notes
|
| Amount: | $21.3 million
|
| Securities: | Secured deferrable floating-rate notes
|
| Coupon: | Libor plus 35 bps
|
| Rating: | Fitch: BBB- expected
|
|
|
| Class D-N notes
|
| Amount: | $22.8 million
|
| Securities: | Secured deferrable floating-rate notes
|
| Coupon: | Libor plus 738 bps
|
| Rating: | Fitch: BB- expected
|
|
|
| Equity
|
| Amount: | $67.04 million
|
| Securities: | Subordinated notes
|
| Ratings: | Non-rated
|
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