Carlyle Group says it has become the world’s largest collateralised loan obligation manager after buying a portfolio of assets from New York-based investment management firm CBAM Partners for $615 million with cash from Carlyle’s balance sheet and 4.2 million newly issued common shares.
The assets are worth around $15 billion, mostly in the form of CLOs, and will take Carlyle’s CLO assets under management to around $48 billion. The CLO assets, along with various other private debt assets, will be integrated into Carlyle’s Global Credit platform.
Carlyle said the transaction would have “an immediate and accretive impact to fee-related earnings and distributable earnings per common share”.
“Acquiring these assets from CBAM adds scale to our already strong CLO business and creates shareholder value on day one by delivering a substantial and accretive increase in fee-related earnings,” said Mark Jenkins, head of global credit at Carlyle.
Carlyle was already among the largest CLO managers globally, issuing 14 new broadly syndicated CLOs raising $7.4 billion last year. This was a record level of CLO activity in any given year for the firm.
Carlyle Global Credit was worth $73 billion at the end of last year – around twice its size four years ago, since when it has been the fastest-growing segment within the firm. The platform raised $17 billion last year and recently expanded its activities with a number of credit-related deals including the $3 billion acquisition of a net lease real estate portfolio from iStar.