KKR brings $564.5 million; MJX refinances $520 million CLO; KCAP’s CLO profit climbs

By Cristal Cody

Tupelo, Miss., May 7 – KKR Financial Advisors II, LLC brought a $564.5 million CLO deal expected to close on Thursday, while the refinancing space remains active, market sources said.

MJX Asset Management LLC refinanced $520 million of notes in a vintage 2012 CLO deal.

In other market activity, KCAP Financial, Inc. reported late Wednesday that first-quarter investment income from investments in CLO fund securities jumped 45% to $4.6 million from the same period a year ago.

KCAP’s portfolio company, Trimaran Advisors, LLC, priced the $464 million Catamaran CLO 2015-1 Ltd./Catamaran CLO 2015-1 LLC deal that closed on Tuesday. Trimaran has priced five CLOs since KCAP acquired the firm in 2012.

KKR prices $564.5 million

KKR Financial Advisors II sold $564.5 million of notes due April 15, 2027 in the KKR CLO 11 Ltd./KKR CLO 11 LLC deal, a source said.

The CLO priced $352 million of class A senior secured floating-rate notes at Libor plus 152 basis points at the top of the capital structure.

Credit Suisse Securities (USA) LLC was the placement agent.

KKR Financial Advisors II will manage the CLO.

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

Proceeds from the offering will be used to purchase a portfolio of about $550 million of leveraged loans.

KKR Financial Advisors brought two U.S. CLO transactions in 2014.

The firm is a subsidiary of KKR Asset Management, LLC.

MJX refinances CLO

MJX Asset Management priced $520 million of notes due Nov. 14, 2022 in a refinancing of the vintage 2012 Venture XI CLO, Ltd./Venture XI CLO Corp. transaction, according to a market source.

The CLO sold $326.3 million of class A-R senior secured floating-rate notes at Libor plus 130 bps, tighter than where the notes first priced at Libor plus 145 bps.

The CLO refinanced $57.9 million of class B-R senior secured floating-rate notes at Libor plus 195 bps, compared to the original spread of Libor plus 235 bps.

In the class C-R tranche, the CLO sold $35.1 million of senior secured deferrable floating-rate notes at Libor plus 295 bps, tighter than where the notes first priced at Libor plus 325 bps.

The CLO sold $18.6 million of class D-R senior secured deferrable floating-rate notes at Libor plus 395 bps. The notes originally priced at Libor plus 500 bps.

The CLO priced $20.1 million of class E-R senior secured deferrable floating-rate notes at Libor plus 615 bps, better than where the issue first priced at Libor plus 650 bps.

In the final tranche, the CLO sold $11 million of class F senior secured deferrable floating-rate notes at Libor plus 775 bps, wider than where the notes originally priced at Libor plus 750 bps.

The deal also included the original $51 million equity tranche of subordinated notes.

Citigroup Global Markets Inc. was the refinancing agent.

MJX Asset Management is the CLO manager.

The CLO is backed primarily by broadly syndicated senior secured corporate loans.

Proceeds from the refinancing will be used to redeem the original notes.

MJX Asset Management previously was in the primary market with the $616.3 million Venture XX CLO, Ltd./Venture XX CLO LLC deal on March 13.

The New York City-based asset management company brought four CLO transactions in 2014.

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