News
January 2020
|
Issue 219 Top stories on
creditflux.com
in 201924 January
GoldenTree sets CLO spread benchmark with 2019’s first five-year deal
It took until 24 January for the first five-year CLO to price in 2019. The senior notes in GoldenTree US CLO 4 print at 132.7 basis points. This is a strong effort considering spreads did not tighten meaningfully from this level last year. GoldenTree 4 is the 16th tightest print out of 127 five-year deals.
27 February
Loan sell-off leaves some CLO warehouses out of the money
The December 2018 loan sell-off may have been good for CLO equity, but it leaves many warehouses out of the money, according to several sources. Investors say that warehouses opened in the first half of 2018 are hit hardest.
27 August
Head of structured credit quits Barings for GreensLedge
CLO veteran Matt Natcharian leaves Barings after 24 years and, in a surprising move, lands at US brokerage GreensLedge to launch an asset management business. GreensLedge is part-owned by Sumitomo Mitsui Trust Bank.
Natcharian is joined at GreensLedge Asset Management by Barings colleague Derek Yaworsky. Big things are expected of this firm in 2020 given the experience of its leadership team and the infrastructure in place.
7 March
Former KKR pair resurface with new direct lending business
Marc Ciancimino, the former global co-head of mezzanine and European head of private credit at KKR, and Cristobal Cuart, a former director in KKR’s private credit unit, launch All Seas Capital Partners. It targets middle market companies with €10-50 million in ebitda.
30 April
Sungard bankruptcy causes minor burns for CLOs
$202.5 million of tech group Sungard’s loan basks in CLO structures in Q1 2019. Carlyle Group has $115 million of exposure, according to CLO-i.
Sungard files a pre-packaged bankruptcy plan, which is confirmed after just 19 hours. As part of this, $1.3 billion of debt is exchanged for $300 million of debt and 89% of reorganised equity.
3 March
We can’t hide it any longer, we’re tiering up
The opening months of 2019 highlight a clear class system among CLO managers. BlackRock tops the list of managers able to price their triple A notes at the tightest levels, with its 2017 and 2018 US CLOs pricing 8.7bp tight of prevailing spreads.
18 June
CLO pipeline: RVX emerges with unusual transaction
Emerging market specialist RVX re-entered the market with a CBO, reviving a deal that first surfaced in 2018. However, the comeback hasn’t worked out. The EM CBO, structured by Jefferies, is yet to price as Creditflux goes to press.
8 May
CLO head exits BAML and goes to buy-side
At the Creditflux CLO Symposium in London, we break the news that Wynne Comer, head of Bank of America’s CLO business, is leaving to join a start-up credit manager.
A few hours later we report that AGL Credit Management — the new CLO manager launched by Peter Gleysteen — is her destination.
Comer joined AGL as chief operating officer, in her first buy-side role
30 May
Arrival of five-year bespokes draws in CLO investors
Synthetic bespoke tranches are undergoing a major shift, with dealers projecting five-year business to soon supersede previously dominant shorter tenors. It’s been slow going though, with just 5% of deals in 2019 falling in this category (see ").
CSO arrangers look to build on $65bn of issuance in 2019
"3 July
US insurer seeks CLO portfolio manager to run $4.6 billion portfolio
American Equity Investment Life Insurance Company is looking to appoint a portfolio manager to oversee its CLO investments. As Creditflux goes to press the insurer is yet to fill the vacancy.
4 July
Tranche trading is back: relative value plays power growth
Relative value plays across synthetic markets are back. JP Morgan index tranche trader
Samuel Lilley
says there is enough liquidity in off-the-run index tranches to place curve trades. 28 June
AA Battery: GSAM powers back into the CLO market and merges senior tranches
Goldman Sachs Asset Management prices its first 2.0 CLO, but with the absence of a regular triple A-rated tranche. Instead, the most senior debt in Battery Park CLO was rated double A, having merged what would have been triple A notes with regular double As.
13 August
Credit manager wins $300 million from Texas pension
Texas County & District Retirement System allocates $300 million to a separately managed account with structured credit specialist 400 Capital Management.
3 September
CLO managers went to CCC, to see what they could CCC…
CLO portfolios are drifting towards low single B and triple C names. But triple C buckets aren’t in danger of overflowing, so managers can be even more aggressive. Half of the CLOs we analysed had 25% of their portfolios backed by low single B and triple C-rated loans.
12 August
BlueMountain buyout brings CLO equity shift
There are sweeping changes at BlueMountain following its acquisition by Assured Guaranty, with CLOs set to be the focus. A later announcement reveals that the BlueMountain hedge fund is being wound down and co-founder Stephen Siderow is leaving.
23 September
Man GLG shakes up US CLO team
Man GLG assigns leadership of its US CLO business to Joshua Cringle and Jonathan Newman. The pair will replace Steven Kalin and Richard Kurth. Cringle and Newman report to London-based credit CIO Simon Finch, but he leaves a few weeks later.
16 October
Highland files for bankruptcy
Highland Capital Management files for Chapter 11 bankruptcy in the District of Delaware, punctuating a costly couple of years for the firm, which was previously ordered to pay $8 million to former employee Josh Terry, who subsequently took over management of Highland’s US CLO business.
5 September
US hedge funds use leverage to buy European CLOs
Boca Raton-based hedge fund manager III Capital Management is leading the charge as US hedge funds employ leverage to buy European triple A-rated CLOs. CLO trader
Christian Pellegrino
says that European senior is attractive to US investors, even taking into account cross-currency swaps. 25 November
Head of CLO management leaves DFG shortly after promotion
The new head of DFG Investment Advisers’ CLO business Timothy Milton leaves less than three months after his promotion. He resurfaces at potential CLO debutant Silver Rock.
11 November
The Last Tranche with THL’s Herzig: loan bifurcation and the direct lending safety net
For
Creditflux’s
Last Tranche podcast, THL Credit’s Michael Herzig
joins Hugh Minch and Seth Brumby to talk about bifurcation in the US loan market, why some borrowers might suffer refinancing woes and how direct lending funds can provide financing even to large-cap companies. Global credit funds & CLO's
January 2020
| Issue 219 Published in London & New York.
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