Oaktree sells CLO; Eaton Vance, Och-Ziff refinance; refi volume nearly $26 billion to date

By Cristal Cody

Eureka Springs, Ark., Dec. 12 – CLO issuance and refinancing action continues to remain strong as the year comes to a close, market sources report.

In new issuance, Oaktree Capital Management LP priced a $601.66 million CLO.

In the refinancing space, both Eaton Vance Management and Och-Ziff Loan Management LP refinanced vintage 2013 deals.

Eaton Vance priced $401.9 million of notes in the transaction.

Och-Ziff Loan Management refinanced $583.26 million of notes.

“CLO new issuance conditions have remained robust heading into year-end,” J.P. Morgan Securities, LLC analysts said in a note released on Monday.

“The CLO refi/reset market has been wide open in both the U.S. and Europe the past few months and has set records in terms of volumes in 2016,” the analysts said. “CLO equity investors have been incentivized to refinance the past few months due to tight liability spreads, tight asset spreads which have eroded equity economics, and upcoming U.S. risk retention rules.”

According to a BofA Merrill Lynch note released on Monday, December CLO refinancing and reset volume totals about $3.9 billion, while more than $25.5 billion of CLOs have been refinanced year to date.

Oaktree sells $601.66 million

Oaktree Capital Management sold $601.66 million of notes due Oct. 20, 2027 in the new Oaktree EIF III Series I Ltd. transaction, according to a market source.

The CLO priced $372 million of class A floating-rate notes at Libor plus 141 basis points in the AAA-rated tranche.

Wells Fargo Securities LLC was the placement agent.

The deal is backed predominantly by broadly syndicated first-lien senior secured loans and eligible investments.

Oaktree Capital Management has priced two U.S. CLOs in 2016.

The Los Angeles-based asset management firm, a subsidiary of Oaktree Capital Group, LLC, was in the primary market in 2015 with three CLO deals.

Eaton Vance resets 2013-1 CLO

Eaton Vance Management priced $401.9 million of notes in a refinancing and reset of a 2013 CLO deal, according to a market source.

Eaton Vance CLO 2013-1 Ltd./Eaton Vance CLO 2013-1, LLC sold $260.6 million of class A-1-R senior secured floating-rate notes at Libor plus 142 bps in the senior tranche.

Credit Suisse Securities (USA) LLC arranged the refinancing transaction.

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

Proceeds will be used to redeem the original notes.

Boston-based Eaton Vance Management, a subsidiary of Eaton Vance Corp., priced one CLO transaction in 2015.

Och-Ziff refinances CLO

Och-Ziff Loan Management refinanced $583.26 million of notes due Jan. 22, 2025 at par in a vintage 2013 CLO transaction, according to a market source.

OZLM Funding III, Ltd./OZLM Funding III LLC priced $396.5 million of floating-rate notes at Libor plus 155 bps in the class A-1R slice.

Citigroup Global Markets Inc. arranged the deal.

Och-Ziff Loan Management has refinanced two vintage CLOs year to date.

The firm is an affiliate of New York City-based alternative asset management firm Och-Ziff Capital Management Group LLC.

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