Oaktree, Loomis Sayles, Seix CLOs price; secondary thin; mezzanine spreads edge tighter

By Cristal Cody

Tupelo, Miss., Aug. 10 – New primary action in the CLO market includes deals from Oaktree Capital Management LP, Loomis, Sayles & Co., LP and Seix Investment Advisors LLC, while secondary activity remained quiet.

Oaktree Capital Management was in the primary market with a $511.75 million CLO transaction.

Loomis, Sayles & Co. brought a $412.7 million deal, the firm’s first CLO offering since 2006.

Seix Investment Advisors placed $415.6 million of notes in its CLO deal.

Issuance may remain light over August while market participants wait to see if the Federal Reserve hikes interest rates at the September policy meeting, according to market sources.

“Among other things, the Fed guessing game probably means that CLO activity will remain light until later in September,” according to a J.P. Morgan Securities LLC market note.

In the U.S. CLO secondary market, activity has been fairly quiet with less than $300 million of BWIC volumes up for bid over the previous week, according to BofA Merrill Lynch.

“The market tone has not changed much over the past few weeks,” BofA Merrill Lynch analysts said in a note. “Junior mezzanine tranches continue to trade in a wide range. There was not much offered in equity and higher portfolio commodity concentrations continue to be scrutinized by investors.”

Secondary CLO mezzanine spreads are edging tighter, according to the J.P. Morgan Securities note.

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