Vibrant, MidOcean, Dorchester Park CLOs price; Dorchester triple-A tranche hits 140 bps spread

By Rebecca Melvin

New York, Feb. 5 – Terms emerged Thursday on three recently priced collateralized loan obligations that between them totaled more than $1.3 billion of notes.

The deals included the $414.35 million Vibrant CLO III, the $411 million MidOcean Credit CLO IV and the $509.44 million Dorchester Park CLO.

Meanwhile U.S. CLO credit performance has remained stable into 2015 amid benign fundamentals although loan price action has moved average equity NAV lower, Bank of America Merrill Lynch analysts wrote about CLOs in their most recent securitization products note.

The outlook is for a slight pickup in defaults in distressed names, particularly in the energy, materials and retail sectors, the analysts wrote in their firm’s Securitization Weekly published Jan .30.

Nevertheless they hold that credit performance will remain favorable as loan fundamentals “begin to normalize,” and credit selection reemerges as a primary factor in CLO performance

Dorchester Park pricing

The Dorchester Park CLO Ltd./Dorchester Park CLO LLC consists of floating-rate notes and subordinated notes under manager GSO/Blackstone Debt Funds Management LLC.

It “represents a triple-A tight since a couple of deals priced at the same level in 2013,” according to the BofA Merrill Lynch Securitization Weekly.

The $509.44 million of Dorchester Park notes due Jan. 20, 2027 included a $312.5 million tranche of class A floating-rate notes (//AAA) at Libor plus 140 basis points.

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