KKR Financial Advisors II to price $509.05 million CLO; non-investment-grade issues trade

By Cristal Cody

Eureka Springs, Ark., Nov. 15 – KKR Financial Advisors II, LLC plans to price the CLO manager’s third new CLO deal of 2016, according to a market source on Tuesday.

More than $73 billion of CLOs have priced in the U.S. primary market year to date, according to Prospect News data.

In the securitized secondary market, non-investment-grade securities remain active.

On Monday, $80.25 million of high-grade CBO/CDO/CLO issues and $103.45 million of non-investment-grade securities were traded, according to Trace.

KKR offers $509.05 million

KKR Financial Advisors II is offering $509.05 million of notes due Jan. 20, 2029 in the KKR CLO 16 Ltd./KKR CLO 16 LLC transaction, according to a market source.

The deal includes $325 million of class A-1 floating-rate notes (//AAA); $54.3 million of class A-2 floating-rate notes; $26.1 million of class B floating-rate notes; $33.6 million of class C floating-rate notes; $21.1 million of class D floating-rate notes and $48.95 million of subordinated notes.

Citigroup Global Markets Inc. is the placement agent.

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

Proceeds will be used to purchase a portfolio of $500 million of mostly first-lien senior secured loans.

KKR has priced two new U.S. CLOs and refinanced one vintage U.S. CLO transaction year to date.

The investment firm, an affiliate of Kohlberg Kravis Roberts & Co. LP, placed three new CLO transactions in 2015.

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