Acis prices; Neuberger preps $412.21 million CLO; AAA investors want 'too wide of spreads'

By Cristal Cody

Tupelo, Miss., Sept. 12 - Highland Capital Management, LP brought the week's first collateralized loan obligation transaction with a $650 million offering, according to informed sources on Thursday.

Acis CLO 2013-2 Ltd./Acis CLO 2013-2 LLC sold the expected AAA-rated tranche at a discount at Libor plus 50 basis points.

"That was just a sign the investor wanted to buy the bond at a discount rather than at par," one source said.

The primary market in CLOs has stayed fairly quiet in September, but at least five to 10 deals are in the pipeline, sources said.

"It hasn't been a friendly market," a source said. "There's some volume in the secondary, but primary has been quiet for the past four weeks."

CLO manager Neuberger Berman Fixed Income LLC may be in the market in the upcoming week to price its $412.21 million CLO, according to informed sources on Thursday.

New CLO spreads remain on average unchanged from August, with "triple A investors still demanding too wide of spreads in order to create an attractive equity yield for the equity buyer," one source said. "Loan spreads have not changed at all - they're still relatively tight."

AAA-rated CLO tranche investors are demanding up to Libor plus 140 basis points for top-tier manager deals, compared to Libor plus 150 bps and higher for lower-tier managers, the source said.

Highland prices second CLO offering

Highland Capital Management priced $650 million of floating-rate and subordinated notes in the Acis CLO 2013-2 transaction via Jefferies LLC, according to informed sources on Thursday.

Highland affiliate Acis Capital Management, LP will manage the CLO. The vehicle is collateralized by broadly syndicated first-lien senior secured loans.

Full deal terms were not available by press-time.

Highland was last in the market in February when it sold the $525.5 million Acis CLO 2013-1 Ltd. transaction.

The Dallas-based firm manages 23 CLOs and is the largest U.S. CLO manager with about $18 billion of assets under management.

Neuberger Berman to price $412.21 million

Neuberger Berman Fixed Income set details for its expected $412.21 million offering of notes due Oct. 15, 2025, informed sources said on Thursday.

Neuberger Berman CLO XV, Ltd./Neuberger Berman CLO XV, LLC will bring $1.25 million of class X senior secured floating-rate notes (Aaa//); $105 million of class A-1 senior secured floating-rate notes (Aaa//); $150 million of class A-2 senior secured floating-rate notes (Aaa//); $20 million of class B-1 senior secured floating-rate notes; $25 million of class B-2 senior secured fixed-rate notes; $29 million of class C-1 secured deferrable floating-rate notes; $20.75 million of class D secured deferrable floating-rate notes; $17.75 million of class E secured deferrable floating-rate notes; $7.5 million of class F secured deferrable floating-rate notes and $35.96 million of subordinated notes.

Wells Fargo Securities LLC is the underwriter.

The transaction is expected to close on Oct. 9.

Neuberger Berman Fixed Income was in the market in May when it priced the $413.19 million Neuberger Berman CLO XIV, Ltd./Neuberger Berman CLO XIV, LLC deal.

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