THL Credit closes $612m CLO

This marks the firm’s 11th such vehicle since the global financial crisis.

THL Credit Advisors has closed on a $612 million collateralised loan obligation led by Morgan Stanley, the company said last week.

Michael Herzig, managing director, said in a statement the CLO is the second deal that the asset manager has done with Morgan Stanely. “They continue to provide differentiated structuring and syndication in the CLO space,” he added.

THL Credit has now closed 11 CLOs since the financial crisis, totaling $5.9 billion in issuance since December 2012. The previous CLO led by Morgan Stanley closed on $656 million, the company said in November.

The CLO business falls under the firm’s tradable credit strategy led by Jim Fellows and Brian Good. Fellows became THL’s new chief investment officer last month, as Private Debt Investor reported at the time.

Their success with another CLO close comes only months after implementation of US risk retention rules, which require fund managers to hold 5 percent interest in securitised assets they manage,  which will likely shape the CLO marketplace this year.

Overall, CLO issuance in the US has declined in the last two years, according to Creditflux data, with the total last year reaching $68.4 billion, down from $98.95 billion in 2015.

Boston-based THL has a total of $9.1 billion in assets. The firm pursues direct lending and tradable credit strategies through public and private vehicles, separately managed accounts, commingled funds and collateralised loan obligations.