Douglas Paolillo, previously managing director at Blackstone subsidiary GSO Capital Partners, has joined TPG as head of its CLO business in New York, a spokesperson confirmed to Private Debt Investor. In his previous role, he worked in GSO’s debt funds group and was a member of the investment committee. He had been at GSO / Blackstone since 2002.
The US CLO market has enjoyed a buoyant start to 2013, building on a strong 2012.
Standard & Poor's Ratings agency estimates that there are currently 129 managers who manage $281.748 billion in CLOs across 671 transactions.
In an attempt to move diversify away from leveraged buyouts, TPG is in the process of raising its first CLO, a source close to the situation, confirmed with Private Debt Investor. Its credit arm, TPG Credit Partners, specialises in distressed debt but the new fund marks the first time the firm has sought to raise a CLO. TPG also manages a business development company (BDC), TPG Specialty Lending, which had $1.5 billion of committed capital as of 31 January.
TPG declined to comment on the CLO raising.
Last year saw eleven new CLO managers entering the market – primarily represented by experienced loan teams entering the CLO market for the first time and two entities that entered the CLO market by acquiring existing platforms, according to S&P.
New players who completed transactions in the US market included: 3i Debt Management, Anchorage Capital Group, Benefit Street Partners, BMO Asset Management Corp, Credit Industriel et Commercial, Highbridge Principal Strategies, MP Senior Credit Partners, Oaktree Capital Management, Sound Harbor Partners, Sound Point Capital Management, and Valcour Capital Management.
According to the rating agency, assets under management (AUM) increased by $7.936 billion since June 2012, with over 25 transactions. Although there were 75 new publicly rated CLOs during this period, the net increase in AUM was constrained because 50 transactions were redeemed and many of the remaining transactions had been repaid post-reinvestment period.