Purple Finance CLO 2 emerges from European CLO market; U.S. primary remains quiet

Chicago, Sept. 12 – While the U.S. domestic primary CLO market was silent on Thursday, a new issue appeared from Europe.

The deal is set to close in mid-October, and while coupons and rates were not yet available, the deal from Purple Finance CLO 2 DAC priced for €409.3 million.

In eight tranches and then a subordinated note tranche, the deal comes with a four-year reinvestment period.

The portfolio is expected to be 60% ramped on the Oct. 15 closing day and then fully ramped within the six-month ramp-up period thereafter.

The deal will be managed by Ostrum Asset Management, previously known as Natixis Asset Management, a French firm with €271.3 billion in assets under management.

At least 95% of the portfolio will need to contain senior secured obligations.

According to Moody’s Investors Service, the transaction has a:

• Weighted average rating factor of 2785;

• Weighted average spread of 3.7%;

• Weighted average coupon of 5.5%;

• Weighted average recovery rate of 44.25%, and a

• Weighted average life of 8.5 years.

If the primary was quieter, the secondary on Wednesday was extremely active.

On Wednesday, $645.75 million of CLOs exchanged hands in the secondary market.

In the CBO/CDO/CLO investment-grade sector, $400.29 million of that was accounted for in 90 trades. That left $245.46 million for the non-investment grade sector in 50 trades.

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