Onex Credit prices $510m US CLO

After closing its tenth CLO, the Canadian private equity firm will manage $6.5 billion in total CLO volume. The CLO is compliant with US and European risk retention rules.  

Onex Credit Partners, the credit investment arm of Canadian private equity firm Onex Corporation, has priced its tenth collateralized loan obligation (CLO) for $510 million. The transaction will be issued by a newly formed special purpose vehicle and backed by a portfolio of syndicated leveraged loans.

CLO-10 is structured to be compliant with both European and US risk retention rules, Onex said in a statement. The firm has committed to purchase and hold a majority of the equity for the life of the transaction. With the closing of the transaction, Onex Credit will manage $6.5 billion in CLO products, up from $5 billion at the end of 2014.

The Canadian private equity firms trades publicly on the Toronto Stock Exchange under the “OCX” ticker. At Onex Credit, the firm invests in leveraged loans, collateralized loan obligations and other credit securities. The firm’s management has said on previous earnings calls that it intended to ramp up its CLO business in the US and Europe. The firm launched its European CLO business a year ago by appointing Stephen Baker to lead its new London credit office. Baker was a senior portfolio manager with London hedge fund CQS before joining Onex in October 2014.

Overall, Onex has $22 billion of assets under management in private equity and credit securities. With offices in Toronto, New York and London, Onex invests its capital through its two platforms and is the largest limited partner in each of its private equity funds.