CLO primary active; Barings prints; First Eagle Investment reprices middle-market deal

By Cristal Cody

Tupelo, Miss., April 29 – Activity in the broadly syndicated and middle-market CLO spaces picked up last week with new issues and refinanced deals.

Meanwhile, Barings BDC, Inc. sold $449.25 million of notes due April 2027 in new static CLO offering on Monday.

“We are pleased to announce our first debt securitization for Barings BDC,” Eric Lloyd, chief executive officer, said in a news release. “This static CLO allows us to more closely match-fund our broadly syndicated loan portfolio at an attractive all-in cost.”

In new broadly syndicated issuance, LCM Asset Management LLC priced the expected LCM 29 Ltd./LCM 29 LLC offering via Natixis Securities Americas LLC, a source said.

Also, Credit Suisse Asset Management, LLC priced the Madison Park Funding XXXV Ltd./Madison Park Funding XXXV LLC deal. BofA Merrill Lynch was the placement agent.

Final pricing details were not immediately available.

In the middle-market space, First Eagle Investment Management, LLC sold $407.5 million of notes at par in a refinancing and renaming of a 2016 CLO. The CLO manager tightened the AAA-rated tranche by 44 basis points from the original coupon.

Year to date, broadly syndicated and middle-market volume now stands at $42 billion, 5% ahead of the same period a year ago, according to a BofA Merrill Lynch analysts’ note released on Monday.

In the secondary market, $66 million of BWIC supply was seen last week, along with $2.7 billion of combined CLO/CDO Trace volume through Thursday, the analysts said.

“Supply was spread across all rating levels with the exception of single-B bonds, which continue to see very limited volume,” the analysts said.

Spreads tightened for a second consecutive week and headed out on Friday about 2 bps to 15 bps tighter across most tranches, according to the research note.

CLO spreads outperformed investment-grade and high-yield corporate bonds, which widened 3 bps and 5 bps, respectively, on the week.

“Looking forward to the next few months, we think that U.S. CLO spreads are likely to continue to tighten moderately,” the BofA Merrill Lynch analysts said.

Barings prices CLO

Barings BDC sold $449.25 million of notes due April 2027 in the three-part static CLO offering, according to a news release on Monday.

Barings BDC Static CLO Ltd. 2019-I/Barings BDC Static CLO 2019-I, LLC priced $296.75 million of the class A-1 secured floating-rate notes at Libor plus 102 bps.

The Charlotte, N.C.-based business development company’s investment activities are managed by its investor advisor, Barings LLC, which is a subsidiary of Massachusetts Mutual Life Insurance Co.

First Eagle reprices

First Eagle Investment Management sold $407.5 million of notes due Oct. 25, 2028 at par in a refinancing and renaming of vintage 2016 middle-market CLO transaction, according to a market source and a company news release on Monday.

The CLO manager rebranded its name from NewStar Financial, Inc. to its parent company’s name.

First Eagle Berkeley Fund CLO LLC, previously called NewStar Berkeley Fund CLO LLC, sold $290 million of the class A-R senior secured floating-rate notes at Libor plus 166 bps.

Citigroup Global Markets Inc. was the placement agent.

First Eagle Private Credit, LLC will manage the CLO.

In the original $505.5 million NewStar Berkeley Fund CLO 2016-1 transaction issued Nov. 29, 2016, the CLO priced $290 million of class A floating-rate notes at Libor plus 210 bps.

Boston-based First Eagle Private Credit is an investment management company.

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