Greywolf refinances CLO; Highland plans reissue of 2014 CLO; investor demand eyed

By Cristal Cody

Tupelo, Miss., Jan. 26 – The CLO refinancing space remains active with a steady pipeline expected by market sources.

Details emerged on a $649 million reissue that Greywolf Capital Management LP priced in January.

Coming up, Highland CLO Management, LLC plans to refinance $424.25 million of notes from a 2014 CLO.

After CLO issuance finished 2017 stronger than expected, investor appetite is likely to remain robust in 2018 for new issuance and refinanced securities, according to a Fitch Ratings news release on Thursday.

Just in the fourth quarter, 52 new U.S. CLOs totaling $29 billion came to the market, while refinancings and resets were “prevalent” with 54 U.S. CLOs refinancing or resetting liabilities of more than $29 billion, Fitch said.

“CLO managers have taken advantage of optimum financing conditions and are refinancing liabilities as soon as transactions exit their non-call periods,” Kevin Kendra, managing director and U.S. group head at Fitch, said in the release.

In its deal, Greywolf Capital Management priced $649 million of notes in a refinancing and reset of a vintage 2015 collateralized loan obligation, according to a market source.

Greywolf CLO V, Ltd./Greywolf CLO V, LLC priced the $420 million tranche of class A-1-R senior secured floating-rate notes at Libor plus 116 basis points.

Goldman Sachs & Co. LLC arranged the deal.

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