AXA Investment eyes $414 million CLO reprint; secondary AAA spreads flat on thin volume

By Cristal Cody

Tupelo, Miss., June 17 – AXA Investment Managers, Inc. plans to price $414 million of notes in a refinancing of a vintage 2016 CLO offering set to close in July.

Refinanced CLO AAA spreads headed out on Friday unchanged on the week on average in the Libor plus 111 basis points area, according to a Wells Fargo Securities, LLC research note released on Monday.

Meanwhile in the primary market, new issue AAA tranches improved about 1 bp from a week earlier to the Libor plus 128 bps area on average.

In the secondary market, broadly syndicated AAA CLO spreads were mostly flat at the Libor plus 113 bps area, the report said.

CLO secondary market auction volume last week “dropped meaningfully lower” following heavy supply of more than $2.1 billion the previous week, BofA Securities analysts said in a note released on Monday.

BWIC volume ended the week on Friday at $710 million and was concentrated in AAA and equity tranches, including $264 million of senior notes and $126 million of equity notes, according to the report.

AXA to reprice Allegro CLO

AXA Investment Managers plans to price $414 million of notes in a refinancing of the Allegro CLO IV, Ltd./Allegro CLO IV LLC offering, according to a notice of proposed supplemental indenture.

The deal includes $288 million of class A-R senior secured floating-rate notes (expected ratings Aaa//AAA); $52.65 million of class B-R senior secured floating-rate notes (expected ratings Aa2); $24.75 million of class C-R mezzanine secured deferrable floating-rate notes (expected ratings A2); $27 million of class D-R mezzanine secured deferrable floating-rate notes (expected ratings Baa3) and $21.6 million of class E-R mezzanine secured deferrable floating-rate notes (expected ratings Ba3).

Goldman Sachs & Co. LLC is the refinancing placement agent.

Allegro CLO IV was originally issued as a $405.5 million offering of notes due Jan. 15, 2029 on Dec. 22, 2016.

Proceeds from the refinancing will be used to redeem the original notes on July 15.

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

Greenwich, Conn.-based AXA is an asset management firm and subsidiary of Paris-based AXA Group.

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