About $15 billion CLOs in pipeline; Blackstone/GSO prices; Invesco offers $515.5 million

By Cristal Cody

Tupelo, Miss., Feb. 19 – Blackstone/GSO Debt Funds Management Europe Ltd. tapped the European primary market with a €411.1 million CLO deal.

The CLO priced the AAA-rated tranche of notes at Euribor plus 130 basis points, a market source said.

New issuance is expected to be steady but to decline from the more than $120 billion of deals brought in 2014.

“Based on the current pipeline, we expect around 32 CLOs, with a total par of roughly $15 billion, to price or close in the first quarter,” Moody’s Investors Service said in a report on Thursday. “In 2015, we expect deals with multi-currency collateral pools and liabilities to come to market because the non-euro denominated UK market will likely grow the fastest among those in Western Europe.”

Blackstone/GSO prices

Blackstone/GSO Debt Funds Management Europe priced €411.1 million of notes due April 28, 2029 in the Dartry Park CLO Ltd. transaction, according to a market source.

The CLO sold €238 million of class A-1A senior secured floating-rate notes at Euribor plus 130 bps at the top of the capital structure.

At the bottom of the stack, the CLO priced €11.5 million of class E senior secured deferrable floating-rate notes at Euribor plus 700 bps.

Citigroup Global Markets Ltd. arranged the deal.

Blackstone/GSO will manage the CLO, which is secured primarily by secured senior obligations.

Proceeds from the offering will be used to purchase a €400 million portfolio of mostly European leveraged loans and bonds.

The Dublin-based subsidiary of asset manager GSO Capital Partners LP brought four euro-denominated CLO deals in 2014.

Invesco offers $515.5 million

Coming up in the pipeline, Invesco Senior Secured Management, Inc. plans to bring a $515.5 million CLO deal, according to a market source.

The Betony CLO Ltd./Betony CLO LLC offering includes $3 million of class X senior secured floating-rate notes (//AAA); $320 million of class A senior secured floating-rate notes (//AAA); $55 million of class B floating-rate notes; $29.5 million of class C floating-rate notes; $29 million of class D floating-rate notes; $28 million of class E floating-rate notes; $8 million of class F floating-rate notes and $43 million of subordinated notes.

Morgan Stanley & Co. LLC is the placement agent.

Invesco will manage the CLO, which has a two-year non-call period and a four-year reinvestment period.

The notes are due in 2027.

The deal is secured mainly by broadly syndicated senior secured loans.

Proceeds will be used to purchase assets to reach a target portfolio of about $500 million of mostly senior secured leveraged loans.

Invesco Senior Secured Management, a subsidiary of Atlanta-based Invesco, Ltd., priced two CLO transactions in 2014.

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