Bain prices $501 million middle-market CLO; broadly syndicated CLO spreads widen

By Cristal Cody

Tupelo, Miss., Aug. 19 – Bain Capital Specialty Finance Inc. tapped the CLO middle market with a $501 million offering in the manager’s first deal of the year.

CLO middle-market volume totals about $9 billion year to date, compared to $14 billion of middle-market CLOs priced in 2018, sources report.

Elsewhere in the broadly syndicated CLO primary market, dollar-denominated new issue supply has been fairly quiet in August, according to a research note from BofA released on Monday.

Looking at the secondary market, broadly syndicated CLO spreads widened over the past week with AAA-rated tranches going out on Friday an average 2 basis points wider at the Libor plus 117 bps area. Further down the stack, CLO spreads widened 10 bps at the A-rated and BBB-rated tranches, while easing 25 bps in the BB and B tranches.

Bain Capital Specialty Finance priced $501 million of notes and loans due Oct. 15, 2031 in the middle-market CLO offering, according to an informed source.

BCC Middle Market CLO 2019-1 LLC sold $222.5 million of class A-1 floating-rate notes at Libor plus 170 bps at the top of the capital structure.

Natixis Securities Americas LLC was the placement agent.

The deal is backed primarily by middle-market senior secured loans.

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