GoldenTree Loan Management II (GLM II) and its affiliated investment manager GoldenTree Asset Management, closed a $599 million collateralized loan obligation to be managed by GLM II. With the closing of this CLO, GoldenTree Loan Management US CLO 12, GoldenTree has issued 18 CLOs totaling more than $10.5 billion under its GLM CLO strategy. Since its inception in January 2017, the GLM strategy was intended to be compliant with applicable risk retention regulations. While a U.S. court of appeals ruling on February 9, 2018 led to the repeal of U.S. risk retention rules for open market CLOs, GLM CLOs are intended to continue to comply with European Union and United Kingdom risk retention regulations.
GLM US CLO 12 will initially be backed by an 88% ramped $530 million portfolio of senior secured loans as of closing and will have a five-year reinvestment period and a two-year non call period. The CLO was arranged by a bank syndicate including Wells Fargo Securities as structuring lead, and BofA Securities and Morgan Stanley as co-leads. The syndicate globally distributed the investment grade and BB rated notes issued by the CLO, while GLM II invested in the CLO’s equity as well as B rated notes.
GLM US CLO 12 issued $325 million of AAA rated senior notes with a weighted average coupon of S+1.44%, along with lower rated senior, mezzanine and junior notes, for an overall weighted average coupon of S+2.09%.