Onex, Ares price CLOs; loan defaults loom; high-grade secondary supply tops $1 billion

By Cristal Cody

Tupelo, Miss., May 22 – CLO issuance continues to ramp up in May with two more managers tapping the primary market.

Onex Credit Partners, LLC priced a $406.84 million CLO in the manager’s first offering of the year.

Ares Management LLC sold $479.7 million of notes in its first new issue of 2020.

Meanwhile on Friday, AIG Asset Management (US) LLC closed on its previously reported $332.75 million AIG CLO 2020-1, Ltd./AIG CLO 2020-1, LLC offering sold earlier in the month. The CLO priced $210 million of class A floating-rate notes at Libor plus 205 basis points in the senior tranche.

CLOs are facing compounding risks due to the economic fallout from the spread of Covid-19, coupled with approaching loan maturities for companies whose debt CLOs hold, Moody’s Investors Service said in a report released Friday.

Elsewhere, secondary volume soared to $1.11 billion in investment-grade CBO/CDO/CLO paper on Thursday as prices improved, according to Trace data.

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