Fortress Investment wraps middle-market CLO; secondary CBO/CDO/CLO issues remain soft

By Cristal Cody

Tupelo, Miss., July 9 – Fortress Investment Group LLC closed Thursday on its new Fortress Credit Opportunities XIII CLO Ltd./Fortress Credit Opportunities XIII CLO LLC middle-market offering.

The previously reported $390 million CLO priced the AAA-rated class A floating-rate tranche at Libor plus 225 basis points.

Middle-market deal volume totals about $3 billion year to date, while more than $30 billion of new issue dollar-denominated broadly syndicated CLOs have priced, according to market sources.

Primary action otherwise has been fairly quiet in post-Independence Day holiday activity.

In the secondary market, prices have softened across the capital structure this week, according to Trace data.

High-grade CBO/CDO/CLO paper softened to a 95.20 average from 96.10 on Tuesday and 98.20 at the week’s start.

Trading volume included $412.68 million of high-grade CBO/CDO/CLO paper on Wednesday, up from $311.04 million on Tuesday and $225.61 million on Monday.

Lower-rated CBO/CDO/CLO issues averaged 83.40 on Wednesday, down from 85.50 on Tuesday and 88.50 on Monday.

The previous session saw $110.38 million of non-investment-grade issues trade, compared to $167.36 million on Tuesday and $54.96 million on Monday.

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