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Published on 3/6/2017 in the Prospect News Bank Loan Daily.

PGIM, Benefit Street, NewMark refinance CLOs; refinancings make up bulk of February volume

By Cristal Cody

Tupelo, Miss., March 6 – Three CLO managers kicked March off by refinancing vintage 2014 CLOs.

Prudential Investment Management, Inc. affiliate PGIM, Inc. refinanced $564.5 million of notes.

Benefit Street Partners LLC sold $412.5 million in a refinancing of its vintage CLO.

NewMark Capital LLC refinanced $320.08 million of fixed- and floating-rate notes in eight tranches.

Refinancing volume continues to outpace new issuance year to date.

February saw $26.5 billion of deal volume with 70% of supply from refinancings, according to a J.P. Morgan Securities LLC market note released on Monday.

Refinancing volume year to date is nearly $28 billion, according to the note. New 2017 issuance totals about $9 billion to date.

“Demand for shorter paper such as refis is being driven by all-in yield focused investors including asset managers and insurance and buyers in general who see value,” J.P. Morgan Securities analysts said in the note.

In its deal, PGIM refinanced $564.5 million of notes due Oct. 15, 2026 in the Dryden 34 Senior Loan Fund CLO deal, according to a market source.

The vintage 2014 CLO priced $409.5 million of class A-R floating-rate notes at Libor plus 116 basis points in the senior tranche.

Deutsche Bank Securities Inc. was the refinancing agent.

Proceeds from the transaction will be used to redeem the original notes.


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