Prudential prices $504.62 million; Ares resets CLO; Monroe, Allstate notes on tap

By Cristal Cody

Tupelo, Miss., March 2 – In new issuance, PGIM, Inc. priced a $504.62 million broadly syndicated CLO offering.

In the refinancing space, Ares Management LLC sold $977.33 million of notes in a second refinancing of a 2015 broadly syndicated CLO.

Allstate Investment Management Co. plans to price a first refinancing of notes from a vintage 2017 broadly syndicated CLO.

In addition, Monroe Capital Management LLC plans to refinance notes from a 2017 middle-market CLO offering.

Meanwhile, broadly syndicated CLO spreads have widened amid the broader market sell-offs last week that saw stocks sink, bonds widen and Treasuries rally on fears of a coronavirus pandemic.

CLO AAA-BBB spreads eased 9 basis points to 30 bps, while loan sectors including metals, energy, transportation and retail were the most impacted, J.P. Morgan Securities LLC analysts said in a research note on Friday.

New issue CLO AAA tranches ended February on average in the Libor plus 118 bps to Libor plus 138 bps area.

BBB spreads were quoted at the Libor plus 300 bps to Libor plus 375 bps area.

In the secondary market, CLO AAA tranches eased to the Libor plus 125 bps area, 19 bps wider versus Feb. 14, according to JPMorgan’s report.

BBB tranches have widened nearly 65 bps over the past two weeks to the Libor plus 385 bps area.

“Until the COVID-19 outbreak is brought under control, we see spillover into CLOs from repricing of recessionary risks, balanced by the dearth of yield,” the report said. “JPMorgan estimates lower global growth will subtract 0.25% from 2Q U.S. GDP, reinforcing our call for 25 bp Fed easing in June, with more aggressive action centered around the effective lower bound on interest rates if the growth situation necessitates more than one or two cuts.”

Prudential prices

PGIM priced $504.62 million of notes in the new CLO transaction, according to a market source.

Dryden 78 CLO, Ltd./Dryden 78 CLO, LLC sold $320 million of class A floating-rate notes at par to yield Libor plus 118 bps in the AAA-rated tranche.

Goldman Sachs & Co. LLC was the placement agent.

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

The investment management firm is a subsidiary of Newark, N.J.-based Prudential Financial Inc.

Ares refinances

Ares Management priced $977,325,000 of notes in a second refinancing and reset of the vintage 2015 CLO offering, according to a market source and a notice of proposed second supplemental indenture on Friday.

Ares XXXIV CLO Ltd./Ares XXXIV CLO LLC sold $640 million of class A-R2 senior floating-rate notes at Libor plus 125 bps in the senior tranche.

Goldman Sachs was the refinancing placement agent.

Ares CLO Management LLC, an affiliate of Ares Management, will continue to manage the CLO.

The reset notes are due in April 2033.

The original $813.6 million transaction was issued Sept. 2, 2015 and was first refinanced on July 31, 2017.

The CLO is backed primarily by broadly syndicated senior secured corporate loans.

Ares Management is a Los Angeles-based alternative asset management firm.

Allstate to refinance

Allstate Investment Management plans to price a first refinancing of notes from the Aimco CLO 10 Ltd./Aimco CLO 10 LLC deal, according to a notice of proposed first supplemental indenture on Friday.

The offering includes class X senior secured floating-rate notes, class A-R senior secured floating-rate notes (expected rating AAA), class B-R senior secured floating-rate notes (expected rating AA), class C-R mezzanine secured deferrable floating-rate notes (expected rating A), class D-R mezzanine secured deferrable floating-rate notes (expected rating BBB-), class E-R junior secured deferrable floating-rate notes (expected rating BB-) and class F-R junior secured deferrable floating-rate notes (expected rating B-).

Morgan Stanley & Co. LLC is the refinancing placement agent.

Aimco CLO 10 originally was issued as a $455.7 million offering of notes due July 22, 2032 on May 24, 2017.

The CLO is secured primarily by senior secured corporate loans.

Allstate Investment Management is a Northbrook, Ill.-based investment firm and subsidiary of Allstate Corp.

Monroe Capital to refinance

Monroe Capital Management plans to refinance notes due April 22, 2029 from the Monroe Capital MML CLO 2017-1, Ltd./Monroe Capital MML CLO 2017-1, LLC middle-market transaction, according to a notice of proposed first supplemental indenture on Friday.

The deal includes class A-R floating-rate notes, class B-R floating-rate notes, class C-R floating-rate notes, class D-R floating-rate notes and class E-R floating-rate notes.

BNP Paribas Securities Corp. is the refinancing placement agent.

The original $405 million deal was issued Oct. 26, 2017.

The CLO is collateralized primarily by middle-market corporate loans.

Monroe Capital is a Chicago-based firm that provides senior and junior debt and equity co-investments to middle-market companies in the United States and Canada.

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