CIFC, Elmwood, Wellfleet price CLOs; February supply gains; Europe deal pipeline strong

By Cristal Cody

Tupelo, Miss., Feb. 25 – CLO supply is improving with issuance in February already double the volume brought to the market in January.

In the new issue market, CIFC CLO Management II LLC priced a $606.5 million CLO.

Elmwood Asset Management LLC brought $499.4 million of notes to the primary market in its first transaction since the CLO manager was formed in 2018.

Wellfleet Credit Partners, LLC also priced a $314.83 million CLO offering.

New CLO supply totals $11 billion in February after several issuers tapped the primary market last week, according to a BofA Merrill Lynch report released on Monday.

Volume is more than double the $5 billion seen in January.

“Deals with non-U.S. anchor investors continue to generally price at tighter levels,” the report said.

Meanwhile, the European primary market also is staying busy in February. New issue volume is expected to remain similar to the €27 billion of supply seen in 2018, Fitch Ratings said in a release on Monday.

“The pipeline is strong and this provides demand for leveraged loans,” Fitch said. “In 2019, we expect CLOs to take up about half of all leveraged loans issuance, which we forecast at €55 billion, down from €69 billion in 2018, with the rest of the issuance relying on an appetite of a wider investor base.”

CIFC prices $606.5 million

CIFC CLO Management II priced $606.5 million of notes due April 20, 2032 in the CIFC Funding 2019-I, Ltd. broadly syndicated offering, according to a market source.

The CLO sold $387 million of class A senior secured floating-rate notes at Libor plus 135 basis points in the senior tranche.

Morgan Stanley & Co. LLC was the placement agent.

The deal is backed primarily by broadly syndicated first-lien senior secured loans.

The New York City-based investment adviser is an affiliate of CIFC Asset Management LLC.

Elmwood taps market

Elmwood Asset Management priced $499.4 million of notes due April 20, 2030 in the Elmwood CLO I Ltd. broadly syndicated CLO transaction, according to a market source.

The CLO sold $330 million of the class A floating-rate notes at Libor plus 135 bps.

Citigroup Global Markets Inc. was the placement agent.

The transaction is backed primarily by broadly syndicated first-lien senior secured loans.

Elmwood Asset Management is a New York-based hedge fund created in 2018.

Wellfleet prices CLO

Wellfleet Credit Partners priced a $314.83 million broadly syndicated CLO offering of notes due April 20, 2032, according to a market source.

At the top of the capital stack, Wellfleet CLO X, Ltd. sold $187.5 million of class A-1A senior secured floating-rate notes at Libor plus 138 bps, $12.5 million of 3.99% class A-1B senior secured fixed-rate notes and $37.5 million of class A-2 senior secured floating-rate notes at Libor plus 200 bps.

Mizuho Securities USA LLC was the deal arranger.

The deal is collateralized primarily by broadly syndicated senior secured loans.

The Greenwich, Conn.-based performing credit arm was created in 2015 by private investment firm Littlejohn & Co., LLC.

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