GoldenTree closes on $443m CLO

GoldenTree Loan Management (GLM) and GoldenTree Asset Management announced the closing of its latest collateralized loan obligation (CLO) at $443 million.

Managed by GLM, the new GLM US CLO 8 is the latest in a series of 13 CLOs totaling $7.5 billion since the launch of GLM in 2017. Last month, GLM raised $425 million for a European CLO product, showcasing the appetite for opportunistic debt.

According to officials, the GLM strategy is intended to be compliant with applicable risk retention regulations. They say that while in 2018 a U.S. Court of Appeals ruling led to the repeal of risk retention for open market CLOs, the GLM offerings are intended to continue to comply with European regulations on the matter.

Since its inception in 2000, GoldenTree has issued over $17.5 billion of CLOs/CBOs, with $10 billion currently outstanding. In addition, GoldenTree has been an active investor in structured credit since 2007 and currently manages over $5.5 billion of structured products investments across the firm.

The new U.S. CLO will initially be backed by a 93% ramped $419 million portfolio of senior secured loans as of closing and will have a three-year reinvestment period and a one-year non-call period. The CLO was arranged by a bank syndicate including Wells Fargo Securities as the structuring lead, and BofA securities and Morgan Stanley as co-leads.

GLM US CLO 8 issued $279 million of AAA rated senior notes with a coupon of LIBOR+ 1.55%, along with lower rated senior, mezzanine and junior notes, for an overall weighted average floating rate coupon of LIBOR +2.12%. The CLO also issued $14 million AA fixed rate notes with a coupon of 2.44%.

Overall, GoldenTree manages more than $34 billion in strategies across the credit spectrum including high yield bonds, leveraged loans, distressed debt, structured products, emerging markets, private equity and credit-themed equities.