Anchorage prices $404.69 million CLO; Investcorp refinances $368 million; spreads widen

By Cristal Cody

Tupelo, Miss., Aug. 2 – Anchorage Capital Group, LLC priced $404.69 million of notes in a new CLO offering.

Meanwhile, Investcorp Credit Management US LLC sold $368 million of notes in a refinancing of a vintage 2016 CLO deal.

“July U.S. primary supply was roughly in line with June’s volume, but secondary supply fell sharply in July,” Wells Fargo Securities LLC analysts said in a note on Friday. “In July, investors saw $2.3 billion on Bids Wanted in Competition, the lowest amount of the year.”

July BWIC activity was below the 2019 average monthly BWIC volume of $3.3 billion and below the $4.4 billion of BWICs in June, according to the note.

CLO spreads widened in July in the secondary market with A-rated tranches 30 basis points weaker at Libor plus 270 bps on average. BBB spreads widened by 20 bps to the Libor plus 375 bps area, while BB spreads moved 35 bps wider to the 700 bps area, the Wells Fargo analysts said.

Over the week, AAAs eased an average 2 bps in secondary trading to Libor plus 124 bps, according to the report.

AAs were flat on the week at Libor plus 180 bps, while CLO A-rated notes were 5 bps wider at an average Libor plus 245 bps in secondary trading.

BBBs tightened 20 bps over the week to the Libor plus 350 bps area in the secondary market.

In other activity, outflows from leveraged loans rose to $480 million in the week ended Wednesday from $420 million in the previous week, according to a BofA research note released on Friday.

Anchorage Capital prices

Anchorage Capital Group priced $404.69 million of notes due July 22, 2032 in the Anchorage Capital CLO 11 Ltd./Anchorage Capital CLO 11 LLC transaction, according to market sources.

The CLO priced $248 million of the class A floating-rate notes at Libor plus 139 bps.

Wells Fargo Securities LLC was the placement agent.

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

Anchorage Capital Group is a New York City-based asset manager.

Investcorp refinances

Investcorp Credit Management sold $368 million of notes due Oct. 20, 2028 in a refinancing of the Jamestown CLO IX, Ltd./Jamestown CLO IX Corp. deal, according to a market source and a notice of optional redemption by refinancing and proposed supplemental indenture.

The CLO priced $150 million of class A-1A-R senior secured floating-rate notes at Libor plus 117 bps, $110 million of class A-1B-R senior secured floating-rate notes at Libor plus 117 bps and $41.6 million of class A-2-R senior secured floating-rate notes at Libor plus 185 bps at the top of the capital stack.

GreensLedge Capital Markets LLC was the refinancing placement agent.

In the original $407.55 million deal issued by 3i Debt Management U.S. LLC on Sept. 15, 2016, the CLO priced $150 million of the class A-1A floating-rate notes at Libor plus 157 bps, $110 million of class A-1B floating-rate notes at Libor plus 150 bps and $41.6 million of the class A-2 floating-rate notes at Libor plus 200 bps.

Proceeds will be used to redeem the outstanding notes.

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

Investcorp was formed in 2017 following Investcorp Bank BSC’s acquisition of 3i Debt Management from 3i Group plc.

The investment firm has offices in London, New York and Singapore.

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