CIFC issues and refinances $6bn in CLOs in 2017 – exclusive

The CLO activity this year comes as John DiRocco joins the debt manager as COO. 

CIFC has issued four new collateralised loan obligations this year, while refinancing six others, bringing its combined CLO activity so far in 2017 to $5.9 billion, Private Debt Investor has learned.

The New York-based private debt manager issued a total of $2.9 billion in new CLOs as of 14 August: CIFC 2017-1 priced at $800 million in February; CIFC 2017-2 at $583.5 million in March; CIFC 2017-3 at $713.3 million in June; and CIFC 2017-4 at $800 million this month. The firm also refinanced three of its 2013 vintage CLOs and three of its 2014 vehicles.

Oliver Wriedt, co-chief executive officer, told PDI that the attractive liability pricing and optionality of long investment periods in the US CLO space makes new issuance compelling this year. The firm’s last three CLOs had five-year investment periods.

He added that CIFC continues to evaluate CLO opportunities in Europe, as he had mentioned previously. Though the firm’s current Europe activity remains focused on the private lending side rather than structured credit, Wriedt said.

In conjunction with the four newly issued vehicles, CIFC has raised a total of $117.3 million in capital for its fund dedicated to supporting its collateralised loan obligations, the CIFC CLO Strategic Partners, according to a filing with the US Securities and Exchange Commission.

The new fund is a capitalised majority-owned affiliate that supported the four CLOs the firm issued this year, specifically in order to address the new capital requirements of US risk retention rules, Wriedt said. The capital was raised from CIFC’s balance sheet and one third-party investor.

In order to meet the risk retention guidelines, CIFC has used the majority-owned affiliate hybrid structure, which is fairly atypical in the CLO market where the firm has seen more capitalised manager vehicles and other structures, he told PDI in June.

The firm earlier this month announced the hire of John DiRocco, former executive at the credit investment firm Reef Road Capital, as chief operating officer. Based in New York, DiRocco will oversee the firm’s product offering US and globally, reporting to co-chief executive officers Wriedt and Steve Vaccaro.