Fortress brings $561 million reset; KKR, Investcorp to price new euro-denominated CLOs

By Cristal Cody

Tupelo, Miss., April 12 – In new CLO refinancing action, Fortress Investment Group LLC affiliate FC BSL III CM LLC sold $561 million of notes in a reset of a vintage 2015 CLO.

About $35 billion of vintage CLOs have been refinanced year to date, market sources report.

Looking at the European new issue primary market, two CLO managers plan to price deals.

KKR Credit Advisors (Ireland) Unlimited Co. is offering €413.85 million of notes in its first new CLO transaction in the European market since 2016.

Investcorp Credit Management EU Ltd. plans to price a €413.5 million CLO in the manager’s first new deal of 2018.

More than €7 billion of new euro-denominated CLOs have priced year to date, according to market sources.

Fortress Credit resets CLO

FC BSL III CM sold $561 million of notes in a refinancing and reset of the vintage 2015 Fortress Credit BSL III Ltd. transaction, according to a market source and a notice of revised proposed supplemental indenture on Wednesday.

Fortress Credit BSL III priced $331 million of class A-R senior secured floating-rate notes at Libor plus 107 basis points in the senior tranche.

MUFG was the refinancing placement agent.

The maturity on the notes was extended to April 18, 2031 from the initial Oct. 18, 2026 maturity.

The original $425.4 million deal was issued Oct. 22, 2015. The CLO had priced the $259.5 million of class A floating-rate notes at Libor plus 151 bps.

Fortress Investment is a New York City-based investment firm.

KKR plans CLO

KKR Credit Advisors (Ireland) plans to price €413.85 million of notes due April 15, 2031 in the Avoca CLO XVIII DAC offering, according to a market source.

The deal includes €236 million of class A floating-rate notes (AAA); €36 million of class B-1 floating-rate notes (AA); €20 million of class B-2 fixed-rate notes (AA); €24.8 million of class C floating-rate notes (A); €20 million of class D floating-rate notes (BBB); €22.4 million of class E floating-rate notes (BB); €11.6 million of class F floating-rate notes (B-) and €43.05 million of subordinated notes.

Barclays is the placement agent.

KKR Credit Advisors (Ireland) refinanced three vintage euro CLOs in 2017.

The credit investment management firm is based in Dublin.

Investcorp’s offering

Investcorp Credit Management EU plans to price €413.5 million of notes due April 14, 2031 in a new broadly syndicated CLO, according to a market source.

The Harvest CLO XIX DAC deal includes €1.5 million of class X senior secured floating-rate notes (Aaa//AAA); €248 million of class A senior secured floating-rate notes (Aaa//AAA); €22 million of class B-1 senior secured floating-rate notes (Aa2//AA); €20 million of class B-2 senior secured fixed-rate notes (Aa2//AA); €26 million of class C senior secured deferrable floating-rate notes (A2/A); €22 million of class D senior secured deferrable floating-rate notes (Baa2//BBB); €22 million of class E senior secured deferrable floating-rate notes (Ba2//BB); €12 million of class F senior secured deferrable floating-rate notes (B2//B-) and €40 million of subordinated notes.

Merrill Lynch International is the placement agent.

In 2017, Investcorp priced two new euro-denominated CLOs and refinanced six vintage European CLOs.

The CLO manager is a subsidiary of Bahrain-based Investcorp Bank BSC.

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