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Alcentra refinances €373.4 million Jubilee CLO; spreads mostly flat in secondary market
By Cristal Cody
Tupelo, Miss., March 20 – CLO refinancing action remains steady in the U.S. and European markets.
Alcentra Ltd. refinanced €373.4 million of notes in a 2014 vintage euro-denominated CLO offering.
Year to date, €5.1 billion of European CLOs and $36.4 billion of U.S. CLOs have been refinanced, according to a J.P. Morgan Securities LLC note released on Monday.
“Of the 342 U.S. CLOs that originally priced in 2012, 2013, and 2014, 38% have been refinanced, reset or called,” J.P. Morgan analysts said in the note. “We continue to expect 2013 and 2014 vintage refinancings under the guidelines of the Crescent No-Action Letter. Given the inability to refinance multiple times under this mechanism, we believe that CLOs that have not yet been refinanced/reset will have the highest refi probability going forward.”
In the secondary market, 3.0 CLO spreads were mostly unchanged to 10 basis points weaker at the bottom of the capital stack. AAA rated notes ended Friday about 1 bp tighter on the week at Libor plus 121 bps, according to J.P. Morgan. B tranches eased 10 bps on the week to Libor plus 785 bps.
Alcentra refinances €373.4 million
Alcentra priced €373.4 million of notes due April 15, 2027 in a refinancing of the Jubilee CLO 2014-XI BV transaction on Thursday, according to a market source.
The CLO sold €235 million of class A-R floating-rate notes at par to yield Euribor plus 87 bps in the senior tranche.
In the original transaction, Jubilee CLO 2014-XI sold €227 million of class A senior secured floating-rate notes at Euribor plus 140 bps.
Morgan Stanley & Co. International plc arranged the deal.
Alcentra will continue to manage the CLO.
The London-based global asset management firm is an indirect subsidiary of BNY Alcentra Group Holding, Inc.
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