Trimaran offers $695.8 million notes in 2014 CLO reset; most 2014 vintage CLOs refinanced

By Cristal Cody

Tupelo, Miss., Oct. 10 – Trimaran Advisors, LLC plans to return to the CLO market for the first time this year to price $695.8 million of notes in a refinancing and reset of a 2014 CLO deal.

Trimaran Advisors was last in the CLO market on Nov. 17, 2016 when it refinanced $372.75 million of notes in three tranches from the Catamaran CLO 2014-2 Ltd./Catamaran CLO 2014-2 LLC transaction.

Nearly $109 billion in U.S. broadly syndicated CLOs have been refinanced year to date, according to a Wells Fargo Securities LLC research note on Tuesday. The figure does not include reset deals.

Year to date, nearly 80% of all 2014 vintage CLOs have already refinanced, while 55% of 2013 CLOs and 67% of 2012 CLOs have refinanced or reset, according to the note.

“With over $100 billion in CLO refis YTD, CLO equity holders have seen temporary hits to their equity payments from the fees required to refinance the deal,” the analysts said in the note. “We calculate the average cost of refinancing a CLO since YE 2015 – measured as a relative reduction in equity distributions – to be 94 [basis points] per payment, and the average benefit – measured as a relative increase in distributions – to be 40 bps.

“This implies an average break-even period of 2.3 payments after the CLO refinancing date.”

Catamaran CLO reset

Trimaran Advisors plans to price $695.8 million of notes in a refinancing and reset of the Catamaran CLO 2014-1 Ltd./Catamaran CLO 2014-1 LLC transaction, according to a market source.

The CLO deal includes $2 million of class X floating-rate notes (//AAA); $429.5 million of class A-1A-R floating-rate notes (//AAA); $17 million of class A-1B-R floating-rate notes; $60 million of class A-2-R floating-rate notes; $37 million of class B-R floating-rate notes; $37 million of class C-R floating-rate notes; $38.5 million of class D-R floating-rate notes; $6.5 million of class E-R floating-rate notes and $68.3 million of subordinated notes.

MUFG is the refinancing placement agent.

The maturity on the refinanced notes will be extended to April 22, 2030 from the original April 20, 2026 maturity.

The original $467,925,000 offering was issued on May 6, 2014.

Proceeds from the refinancing will be used to redeem the original notes on Oct. 20.

Trimaran Advisors is a New York-based portfolio company of KCAP Financial, Inc.

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