PineBridge, 3i tap European, U.S. CLO markets; handful of deals to price before holiday

By Cristal Cody

Tupelo, Miss., Nov. 18 - PineBridge Investments Europe Ltd. and 3i Debt Management U.S. LLC tapped the U.S. and European collateralized loan obligation markets with new transactions, according to informed sources on Monday.

PineBridge priced the European CLO transaction at Euribor plus 130 basis points at the top of the capital structure and Euribor plus 520 bps at the bottom of the stack.

The deal brings total European issuance this year to more than €6 billion, a source said.

In the U.S. market, 3i Debt Management U.S. LLC sold $515.9 million in the Jamestown CLO III Ltd. deal. The offering priced with a spread of 145 bps over Libor in the AAA portion and with a spread of 460 bps over Libor in the bottom tranche.

"It's been relatively pretty active, despite the fact that arbitrage is difficult," a market source said of primary activity. "In October, there was $7 billion [of issuance]. This month, we're already close to $3.5 billion."

About three to five new CLO deals are in the pipeline to price before the U.S. Thanksgiving Day holiday, a source said.

"We'll probably see another five to seven deals for the rest of the month and maybe a handful in December," the source said.

Apollo Credit Management LLC is expected to be in the market before the end of the year with its previously announced U.S. dollar-denominated CLO offering via Wells Fargo Securities LLC, a source said.

In the European market, CVC Credit Partners, LLC's long-planned CLO deal via Goldman Sachs & Co. also is in the pipeline to price before the end of the year, according to a market source.

PineBridge sells €335 million

PineBridge Investments Europe priced €335 million of notes due 2027 in the European CLO transaction, according to informed sources on Monday.

Euro-Galaxy III CLO BV sold €67 million of variable funding note (/AAA/AAA) at Euribor plus 130 bps.

The CLO priced €94 million of the class A-1 senior secured floating-rate notes (/AAA/AAA) at Euribor plus 130 bps; €40 million of the class A-2 senior secured floating-rate notes (/AAA/AAA) at Euribor plus 170 bps; €19 million of 3.47% class B-1 senior secured fixed-rate notes (/AA/AA) and €22.25 million of class B-2 senior secured floating-rate notes (/AA/AA) at Euribor plus 210 bps.

Lower in the capital structure, Euro-Galaxy III CLO sold €7.75 million of 4% class C-1 fixed-rate notes (/A/A); €11.25 million of class C-2 floating-rate notes (/A/A) at Euribor plus 300 bps; €6.75 million of 5% class D-1 fixed-rate notes (/BBB/BBB); €7.75 million of class D-2 floating-rate notes (/BBB/BBB) at Euribor plus 380 bps; €20.75 million of class E floating-rate notes (/BB/BB) at Euribor plus 520 bps and €38.5 million of subordinated notes.

Barclays Bank plc arranged the offering.

The notes have a non-callable period that ends in December 2015 and a reinvestment period that ends in December 2017.

PineBridge Investments Europe will manage the CLO, while Credit Industriel et Comercial will act as junior collateral manager during the reinvestment period.

The CLO is backed by a revolving pool of euro-denominated senior secured loans and bonds to broadly syndicated corporate borrowers.

PineBridge, a subsidiary of New York City-based PineBridge Investments LLC, plans to use the proceeds to purchase a €327.75 million portfolio of European leveraged loans and bonds.

3i prices $515.9 million

3i Debt Management sold $515.9 million of notes due Jan. 15, 2026 in the Jamestown CLO III deal via J.P. Morgan Securities LLC, according to an informed source.

The CLO priced $287.7 million of class A-1a senior secured floating-rate notes (Aaa) at Libor plus 145 bps; $20 million of 3.33% class A-1b senior secured fixed-rate notes (Aaa); $43.9 million of class A-2a senior secured floating-rate notes at Libor plus 195 bps; $10 million of 4.19% class A-2b senior secured fixed-rate notes; $45.1 million of class B senior secured deferrable floating-rate notes at Libor plus 275 bps; $33 million of class C senior secured deferrable floating-rate notes at Libor plus 330 bps; $21.4 million of class D secured deferrable floating-rate notes at Libor plus 460 bps and $54.8 million of subordinated notes.

The CLO, backed primarily by first-lien senior secured loans and eligible investments, has a non-call period that ends Jan. 15, 2016 and a reinvestment period that ends Jan. 15, 2018.

3i Debt Management, a subsidiary of London-based 3i Group plc, will manage the CLO.

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