American Capital Closes $414 Mln Managed CLO

American Capital said Monday that it closed on the sale of a $414 million of collateralized loan obligation bonds. Deutsche Bank arranged the transaction. American Capital Leveraged Finance Management, a subsidiary of American Capital Asset Management, is externally managing the CLO.

PRESS RELEASE

American Capital, Ltd. (Nasdaq: ACAS) (“American Capital”) announced today that an affiliate, ACAS CLO 2013-1, Ltd. (the “CLO”), has closed on the sale of $414 million of collateralized loan obligation bonds. The transaction was arranged by Deutsche Bank Securities Inc. The CLO is externally managed by American Capital Leveraged Finance Management, LLC, a subsidiary of American Capital Asset Management, LLC, a wholly-owned portfolio company of American Capital, for an annual management fee of 50 basis points of total assets.
The CLO has primarily invested the proceeds of the bonds in broadly syndicated senior secured loans purchased in the primary and secondary markets.
“We are pleased that we materially improved pricing on the financing of our latest CLO versus the CLO that we raised last September,” said Mark Pelletier , American Capital Managing Director, CDO and CLO Group. “We now manage three CLOs and have investments in the equity of 25 CLOs.”
“With this new CLO, American Capital Asset Management continues to expand its funds under management and now manages six private funds and two public REITs,” said Malon Wilkus , American Capital Chairman and CEO.
The bonds sold by the CLO included AAA(sf) through B(sf) rated tranches, and a non‑rated equity tranche of subordinated notes. American Capital Leveraged Finance Management purchased $25.3 million of the non‑rated equity tranche of subordinated notes, with third party investors purchasing the remaining $11 million. The retention of an equity investment by American Capital Leveraged Finance Management is intended to make ACAS CLO 2013-1 compliant with risk retention rules applicable to credit institutions regulated in the European Economic Area.
Capital Structure

Tranche
% of Total Capital
Principal Amount ($)
Moody’s
S&P
Spread
Class A
59.50%
246,500,000
Aaa
AAA
L+1.18%
Class B-1
7.97%
33,000,000
N/A
AA
L+1.90%
Class B-2
4.83%
20,000,000
N/A
AA
L+3.36%
Class C
6.52%
27,000,000
N/A
A
L+2.75%
Class D
5.31%
22,000,000
N/A
BBB
L+3.60%
Class E
4.47%
18,500,000
N/A
BB
L+4.90%
Class F
2.66%
11,000,000
N/A
B
L+6.10%
Subordinated Notes
8.76%
36,300,000
N/A
N/A
N/A

100%
$414,300,00

 
ABOUT AMERICAN CAPITAL
American Capital is a publicly traded private equity firm and global asset manager. American Capital, both directly and through its asset management business, originates, underwrites and manages investments in middle market private equity, leveraged finance, real estate and structured products. American Capital manages $18.6 billion of assets, including assets on its balance sheet and fee earning assets under management by affiliated managers, with $117 billion of total assets under management (including levered assets). American Capital, through a wholly-owned portfolio company, manages publicly traded American Capital Agency Corp. (Nasdaq: AGNC) with approximately a $13 billion market capitalization and American Capital Mortgage Investment Corp. (Nasdaq: MTGE) with approximately a $1.5 billion market capitalization. From its eight offices in the U.S. and Europe, American Capital and its affiliate, European Capital, will consider investment opportunities from $10 million to $750 million. For further information, please refer to www.AmericanCapital.com.