Carlyle, Bain Capital price CLOs; Black Diamond, Apollo, Triumph Capital in deal pipeline

By Cristal Cody

Eureka Springs, Ark., April 28 – CLO primary action is expected to stay busy over the next few weeks following a stronger pace of issuance in April, according to market sources on Thursday.

Carlyle GMS CLO Management LLC brought to market a $499 million deal.

Bain Capital Credit, LP priced a $401.85 million CLO.

Highbridge Principal Strategies LLC also priced the HPS Loan Management 9-2016 Ltd./HPS Loan Management 9-2016 LLC transaction via Citigroup. Final pricing details were not available by press time.

Looking ahead, Black Diamond Capital Management, LLC is marketing a $358.55 million CLO offering.

Also, Apollo Credit Management (CLO) LLC intends to price $423 million of notes in a new deal.

In addition, Triumph Capital Advisors, LLC is preparing to print a CLO.

The CLO market is “definitely a lot stronger,” a source said.

Wells Fargo Securities LLC analysts said in a note on Thursday the improvement in CLOs may be a “fragile rally.”

“As April showers turn to May flowers, the CLO rally continues, but may be losing some momentum,” the analysts said. “We still see strong technical support for CLO mezz and equity, as well as for loans, and CLO valuations are still attractive to other assets. Our base case is that spreads retain a tighter bias, but within a reduced range. However, the rally appears fragile.”

Risks include market sentiment shifts due to central bank actions, currency movements or commodity price moves.

Carlyle prices 2016-2 CLO

Carlyle GMS CLO Management priced $499 million of notes due July 15, 2027 in the Carlyle Global Market Strategies CLO 2016-2, Ltd./Carlyle Global Market Strategies CLO 2016-2 LLC deal, according to a market source.

The CLO sold $310 million of class A-1 senior secured floating-rate notes at Libor plus 156 basis points, $55 million of class A-2a senior secured floating-rate notes at Libor plus 220 bps and $15 million of 3.625% class A-2b senior secured fixed-rate notes at the top of the capital structure.

Citigroup Global Markets Inc. was the placement agent.

Carlyle GMS CLO Management, a subsidiary of Carlyle Investment Management LLC, will manage the CLO.

The transaction has a non-call period that ends July 15, 2018. The reinvestment period ends Jan. 15, 2021.

The deal is backed primarily by broadly syndicated first-lien senior secured corporate loans.

Carlyle Investment Management has priced two U.S. CLO deals year to date.

The asset management firm, an affiliate of the Washington, D.C.-based Carlyle Group, brought to market five U.S. broadly syndicated CLO deals and one middle-market CLO offering in 2015.

Bain prints Race Point X CLO

Bain Capital Credit, formerly known as Sankaty Advisors LLC, priced a $401.85 million CLO, according to a market source.

The Race Point X CLO, Ltd. transaction sold $259 million of class A floating-rate notes at Libor plus 160 bps in the senior tranche.

Citigroup was the placement agent.

Bain Capital will manage the CLO.

The notes are due July 25, 2028.

The CLO is non-callable until July 25, 2018. The reinvestment period on the deal ends July 25, 2020.

Bain Capital priced one CLO transaction in 2015.

The Boston-based credit firm is an affiliate of Bain Capital LLC.

Black Diamond on tap

Coming up, Black Diamond Capital Management is marketing $358.55 million of notes due 2028 in a previously reported CLO offering, according to a market source.

The Black Diamond CLO 2016-1, Ltd. offering is expected to include $183 million of class A-1a senior secured floating-rate notes (Aaa/AAA); $30.5 million of class A-1b senior secured fixed-rate notes (Aaa/AAA); $49 million of class A-2 senior secured floating-rate notes (AA); $27.5 million of class B senior secured deferrable floating-rate notes (A); $15.4 million of class C senior secured deferrable floating-rate notes (BBB-); $16.6 million of class D secured deferrable floating-rate notes (BB-) and $36.55 million of subordinated notes.

J.P. Morgan Securities LLC is the placement agent.

Black Diamond affiliate Black Diamond CLO 2016-1 Adviser, LLC will manage the CLO.

The CLO will have a two-year non-call period and a four-year reinvestment period.

Black Diamond was last in the U.S. CLO primary market in 2014.

The alternative asset management firm is based in Greenwich, Conn.

Apollo markets $423 million

Apollo Credit Management is in the deal pipeline with a $423 million CLO deal, a source said.

The ALM XIX, Ltd. transaction will price via Citigroup.

Apollo previously was in the market this year with a refinancing of an AAA-rated tranche in a vintage 2013 CLO deal.

Apollo Credit Management, a New York City-based subsidiary of Apollo Global Management, LLC, priced four new CLOs and refinanced two vintage CLOs in 2015.

Triumph preps deal

Triumph Capital Advisors plans to bring its first CLO deal of 2016, according to a market source.

Wells Fargo is the placement agent.

Triumph Capital priced one new CLO and refinanced a vintage CLO deal in 2015.

The investment management firm is a subsidiary of Dallas-based Triumph Bancorp, Inc.

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