KKR prices €462.8 million; European CLOs in works; euro spreads better since February

By Cristal Cody

Eureka Springs, Ark., June 7 – KKR Credit Advisors (Ireland) priced a €462.8 million euro-denominated CLO deal in front of several European CLOs expected to price from other managers over the summer, according to market sources.

European CLO volume totals nearly €6 billion from 15 transactions year to date following the deal, according to Prospect News data.

Euro-denominated CLO spreads have tightened at a similar pace in the primary and secondary markets since February, according to a J.P. Morgan Securities LLC note.

KKR Credit Advisors (Ireland) sold €462.8 million of notes due July 15, 2029 in the Avoca CLO XVI DAC deal, according to a market source.

The CLO priced €273.25 million of class A senior secured floating-rate notes at Euribor plus 135 basis points at the top of the capital structure.

BNP Paribas was the placement agent.

KKR Credit Advisors will manage the CLO, which is backed primarily by broadly syndicated first-lien senior secured loans to European and U.S. speculative-grade corporates.

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

KKR Credit Advisors priced two euro-denominated CLO deals in 2015.

The credit investment management firm is based in Dublin.

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