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Carlson Capital refinances $401.86 million 2015 CLO; resets of 2015 CLOs forecast to increase
By Cristal Cody
Tupelo, Miss., July 11 – Carlson Capital, LP is the latest CLO manager to enter the refinancing market.
The management firm priced a $401.86 million refinancing of a 2015 CLO in its first CLO transaction of 2017.
Year to date, nearly $100 billion of vintage CLOs have been refinanced or reset, according to market sources.
The refinancing stream is likely to thin, while reset activity picks up in the second half of the year, Wells Fargo Securities LLC analysts said in a note on Monday.
“We expect the pace of refinancings to slow, given that just $34 billion remains in deals eligible to refinance under the Crescent No-Action letter,” the analysts said. “Though we expect refinancing volume to slow, we expect a pickup in resets in H2 2017, particularly in 2015-vintage CLOs.”
Cathedral Lake III
Carlson Capital priced a $401.86 million refinancing of the Cathedral Lake III Ltd./Cathedral Lake III LLC transaction, according to a notice of revised proposed first supplemental indenture.
The CLO sold $241.65 million of class A-1-R loans at Libor plus 132 basis points and $5.35 million of class A-R senior secured floating-rate notes at Libor plus 132 bps in the senior tranches.
The refinanced notes and loans are due July 16, 2029. The subordinated notes will retain the original Jan. 15, 2026 maturity.
Jefferies LLC was the refinancing placement agent.
Proceeds will be used to redeem the original class A-1 loans, class A-1L notes, class B notes, class C notes, class D notes and class E notes.
Carlson Capital priced one new CLO and refinanced one vintage CLO in 2016.
The alternative asset management firm is based in Dallas.
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