New CLO AAAs soft; Brigade prices $509.2 million CLO; 3i brings $510.5 million of notes

By Cristal Cody

Tupelo, Miss., July 14 – New CLO AAA-rated notes have widened in recent pricing with new issues brought by Brigade Capital Management, LLC and 3i Debt Management U.S. LLC printing at the Libor plus 155 basis points area, according to market sources.

Brigade Capital Management returned to the primary market for the second time this year, this time with a $509.2 million CLO deal.

3i Debt Management U.S. priced a $510.5 million CLO, its second U.S. offering of the year.

July issuance has slowed, though activity is expected to remain steady through the second half of the year.

“CLO supply is set to slow until macro visibility improves and spreads stabilize,” J.P. Morgan Securities LLC analysts said in a market note. “Medium term, with $62.5 [billion] YTD supply we believe our $100-110 [billion] gross US CLO YE15 supply will be met.”

Brigade Capital Management priced a $509.2 million CLO offering of notes due July 15, 2028, according to a market source.

Battalion CLO IX Ltd./Battalion CLO IX LLC sold $322.5 million of class A senior secured floating-rate notes at Libor plus 155 bps in the senior tranche.

Meanwhile, 3i Debt Management sold $510.5 million of notes due July 25, 2027 in the Jamestown CLO VII, Ltd. CLO transaction, a market source said.

The CLO priced $322.5 million of class A-1 senior secured floating-rate notes at Libor plus 155 bps at the top of the capital structure.

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