By Cristal Cody
Tupelo, Miss., Aug. 7 – Sound Point Capital Management LP sold an upsized $631.75 million collateralized loan obligation deal, according to a market source.
Sound Point CLO VI, Ltd./Sound Point CLO VI Inc. priced $4 million of class X senior secured floating-rate notes (Aaa//AAA) at Libor plus 100 basis points at par, $360 million of class A-1 senior secured floating-rate notes (Aaa//AAA) at Libor plus 136 bps at 99.25 and $30 million of 3.44% class A-2 senior secured fixed-rate notes (Aaa//AAA) at par in the offering.
The CLO also sold $69 million of class B senior secured floating-rate notes (Aa2) at Libor plus 198 bps at 98; $33 million of class C deferrable floating-rate notes (A2) at Libor plus 293 bps at 97; $33 million of class D deferrable floating-rate notes (Baa3) at Libor plus 335 bps at 92.5; $27 million of class E deferrable floating-rate notes (Ba3) at Libor plus 505 bps at 89.75 and $15.75 million of class F deferrable floating-rate notes (B2) at Libor plus 540 bps at 84.
The deal included $60 million of subordinated notes in the equity tranche.
The transaction was upsized from $524.88 million.
Morgan Stanley & Co. LLC was the placement agent.
Sound Point Capital Management will manage the CLO.
The vehicle has a two-year non-call period and a four-year reinvestment period.
The notes are due Aug. 18, 2026.
The CLO is backed primarily by first-lien senior secured loans.
Proceeds from the offering will be used to purchase a $500 million portfolio of mostly leveraged loans.
Sound Point Capital Management previously was in the primary market in March with the $628 million Sound Point CLO V, Ltd./Sound Point CLO V Inc. deal.
The New York City-based asset management firm brought three CLO transactions in 2013.
| Issuer: | Sound Point CLO VI, Ltd./Sound Point CLO VI Inc.
|
| Amount: | $631.75 million
|
| Maturity: | Aug. 18, 2026
|
| Securities: | Fixed-rate, floating-rate and subordinated notes
|
| Structure: | Cash flow CLO
|
| Placement agent: | Morgan Stanley & Co. LLC
|
| Manager: | Sound Point Capital Management LP
|
| Call feature: | 2016
|
| Pricing date: | July 23
|
| Settlement date: | Aug. 15
|
| Distribution: | Rule 144A
|
|
|
| Class X notes
|
| Amount: | $4 million
|
| Securities: | Senior secured floating-rate notes
|
| Coupon: | Libor plus 100 bps
|
| Price: | Par
|
| Ratings: | Moody’s: Aaa
|
| Fitch: AAA
|
|
|
| Class A-1 notes
|
| Amount: | $360 million
|
| Securities: | Senior secured floating-rate notes
|
| Coupon: | Libor plus 136 bps
|
| Price: | 99.25
|
| Ratings: | Moody’s: Aaa
|
| Fitch: AAA
|
|
|
| Class A-2 notes
|
| Amount: | $30 million
|
| Securities: | Senior secured fixed-rate notes
|
| Coupon: | 3.44%
|
| Price: | Par
|
| Ratings: | Moody’s: Aaa
|
| Fitch: AAA
|
|
|
| Class B notes
|
| Amount: | $69 million
|
| Securities: | Senior secured floating-rate notes
|
| Coupon: | Libor plus 198 bps
|
| Price: | 98
|
| Rating: | Moody’s: Aa2
|
|
|
| Class C notes
|
| Amount: | $33 million
|
| Securities: | Deferrable floating-rate notes
|
| Coupon: | Libor plus 293 bps
|
| Price: | 97
|
| Rating: | Moody’s: A2
|
|
|
| Class D notes
|
| Amount: | $33 million
|
| Securities: | Deferrable floating-rate notes
|
| Coupon: | Libor plus 335 bps
|
| Price: | 92.5
|
| Rating: | Moody’s: Baa3
|
|
|
| Class E notes
|
| Amount: | $27 million
|
| Securities: | Deferrable floating-rate notes
|
| Coupon: | Libor plus 505 bps
|
| Price: | 89.75
|
| Rating: | Moody’s: Ba3
|
|
|
| Class F notes
|
| Amount: | $15.75 million
|
| Securities: | Deferrable floating-rate notes
|
| Coupon: | Libor plus 540 bps
|
| Price: | 84
|
| Rating: | Moody’s: B2
|
|
|
| Equity tranche
|
| Amount: | $60 million
|
| Securities: | Subordinated notes
|
| Ratings: | Non-rated
|
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