Carlyle Adds $1B CLO Assets Under Management

The Carlyle Group says that it has acquired the management contracts of a $500 million collateralized loan obligation, has created a $507 million CLO, and sees more opportunity to expand into the CLO market, Reuters reported Wednesday. The private equity firm now advises 31 collateral loan funds in the US and Europe, totaling $12.7 billion in assets under management, Reuters said.

(Reuters) – Private equity firm Carlyle Group CYL.UL said on Wednesday it has bought the management contracts of a $500 million CLO, has created a $507 million CLO, and sees more opportunity to expand further in that area.

Collateralized loan obligations (CLOs) are packages of leveraged loans that are sold to investors as bonds. A resurgence in the U.S. CLO market — hard hit by the credit crisis — had been seen earlier this year.

Carlyle said it recently closed its first newly issued CLO since 2008, a $507 million CLO called Carlyle Global Market Strategies 2011-1. It priced the CLO in July, RLPC reported.

It also recently bought the management contract of a $500 million CLO from The Foothill Group Inc.

Carlyle said its structured credit team now advises 31 collateral loan funds in the United States and Europe totaling $12.7 billion in assets under management. It said it sees continued opportunity for acquisitions and in the new issue market for CLOs.

Rival Apollo Global Management (APO.N) in July agreed to a deal to buy Charlotte, North Carolina-based Gulf Stream Asset Management, which manages 10 collateralized loan obligations.

Apollo said on Tuesday that the area is “clearly consolidating” and that it wants to be a consolidator in the CLO and senior loan space. (Editing by Maureen Bavdek and Gerald E. McCormick)