Carlyle completes US, European CLOs

The firm, which is seeking to raise $100bn over four years, added $1.12bn toward that total. 

The Carlyle Group is ending its summer with several collateralised loan obligations, putting the Washington, DC-based firm’s total of such transactions at five globally for the year.

The asset management behemoth said Monday it closed a $613 million broadly syndicated loan CLO arranged by Morgan Stanley and a €464 million ($544.73 million) CLO by Citigroup. The deals are the third in US and the second in Europe.

Both will concentrate heavily on senior secured debt. The US deal mandates a minimum of 90 percent of exposure to such investments, which also must be first lien, while the European CLO requires a 96 percent exposure senior secured securities, according to pre-salereports by Moody’s rating agency.

Covenant-lite loans in the CLO could be between 40-90 percent of the loans in the US deal, depending on several metrics, while that figure stands at a maximum of 30 percent for the European transaction, the Moody’s documents showed.

The timeline for the US CLO lists end dates for the non-call period and reinvestment period as July 2019 and July 2022, respectively. It matures in July 2029, according to a Standard & Poor’s pre-sale report. The European deal’s non-call period and reinvestment period end August 2019 and August 2021 with a maturity date of August 2030, a separate S&P document showed.

Earlier this year, Carlyle closed its first US CLO on $612 million in April, and its second on $610 million in June. The initial European deal, for €413.5 million, closed in last month as well.

The two CLOs, which together raised $1.12 billion, come as Carlyle works toward raising $100 billion firm-wide over four years. In the second quarter, Carlyle raised $8.4 billion, with the earlier CLOs contributing $1.7 billion to that total.