By Cristal Cody
Tupelo, Miss., July 19 – Octagon Credit Investors, LLC priced $520.4 million of notes in a refinancing and reset of the Octagon Investment Partners 27, Ltd./Octagon Investment Partners 27, LLC broadly syndicated collateralized loan obligation transaction, according to a market source and a notice of executed second supplemental indenture on Tuesday.
The CLO sold $310 million of class A-1-R senior secured floating-rate notes at Libor plus 107 basis points, $20 million of class A-2-R senior secured floating-rate notes at Libor plus 135 bps, $27.5 million of class B-1-R senior secured floating-rate notes at Libor plus 160 bps and $22.5 million of 4.5% class B-2-R senior secured fixed-rate notes.
Octagon 27 also sold $35 million of class C-R secured deferrable floating-rate notes at Libor plus 210 bps, $25 million of class D-R secured deferrable floating-rate notes at Libor plus 295 bps, $20 million of class E-R secured deferrable floating-rate notes at Libor plus 595 bps and $10 million of class F-R secured deferrable floating-rate notes at Libor plus 785 bps. The deal included $50.4 million of subordinated notes priced in the original offering.
Morgan Stanley & Co. LLC arranged the offering.
Octagon Credit Investors will continue to manage the CLO.
The maturity on the notes was extended to July 15, 2030 from the original July 15, 2027 maturity. The reset CLO also has an extended two-year non-call period and a five-year reinvestment period.
In the original $510.4 million transaction issued June 28, 2016, the CLO sold $310 million of class A senior secured floating-rate notes at Libor plus 153 bps; $70 million of class B senior secured floating-rate notes at Libor plus 215 bps; $35 million of class C senior secured deferrable floating-rate notes at Libor plus 300 bps; $25 million of class D senior secured deferrable floating-rate notes at Libor plus 475 bps; $20 million of class E senior secured deferrable floating-rate notes at Libor plus 710 bps and $50.4 million of subordinated notes.
Proceeds were used to redeem the original notes.
Octagon Credit Investors has priced four new CLOs and refinanced three vintage CLOs year to date.
In 2017, the CLO manager brought four new CLOs to the primary market.
The New York-based credit investment firm is a subsidiary of Conning & Co.
| Issuer: | Octagon Investment Partners 27, Ltd./Octagon Investment Partners 27, LLC
|
| Amount: | $520.4 million refinancing
|
| Maturity: | July 15, 2030
|
| Securities: | Fixed-rate, floating-rate and subordinated notes
|
| Structure: | Cash flow CLO
|
| Refinancing agent: | Morgan Stanley & Co. LLC
|
| Manager: | Octagon Credit Investors, LLC
|
| Call feature: | July 15, 2020
|
| Settlement date: | July 16
|
| Distribution: | Rule 144A, Regulation S
|
|
|
| Class A-1-R notes
|
| Amount: | $310 million
|
| Securities: | Senior secured floating-rate notes
|
| Coupon: | Libor plus 107 bps
|
| Ratings: | Moody’s: Aaa
|
| S&P: AAA
|
|
|
| Class A-2-R notes
|
| Amount: | $20 million
|
| Securities: | Senior secured floating-rate notes
|
| Coupon: | Libor plus 135 bps
|
| Ratings: | Moody’s: Aaa
|
| S&P: Non-rated
|
|
|
| Class B-1-R notes
|
| Amount: | $27.5 million
|
| Securities: | Senior secured floating-rate notes
|
| Coupon: | Libor plus 160 bps
|
| Rating: | S&P: AA-
|
|
|
| Class B-2-R notes
|
| Amount: | $22.5 million
|
| Securities: | Senior secured fixed-rate notes
|
| Coupon: | 4.5%
|
| Rating: | S&P: AA-
|
|
|
| Class C-R notes
|
| Amount: | $35 million
|
| Securities: | Secured deferrable floating-rate notes
|
| Coupon: | Libor plus 210 bps
|
| Rating: | S&P: A
|
|
|
| Class D-R notes
|
| Amount: | $25 million
|
| Securities: | Secured deferrable floating-rate notes
|
| Coupon: | Libor plus 295 bps
|
| Rating: | S&P: BBB-
|
|
|
| Class E-R notes
|
| Amount: | $20 million
|
| Securities: | Secured deferrable floating-rate notes
|
| Coupon: | Libor plus 595 bps
|
| Rating: | S&P: BB-
|
|
|
| Class F-R notes
|
| Amount: | $10 million
|
| Securities: | Secured deferrable floating-rate notes
|
| Coupon: | Libor plus 785 bps
|
| Rating: | S&P: B-
|
|
|
| Equity
|
| Amount: | $50.4 million
|
| Securities: | Subordinated notes
|
| Ratings: | Non-rated
|
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