Babson Capital Closes $400M CLO

Sep 5 2012 | 10:28am ET

Charlotte, N.C.-based Babson Capital Management has added $400 million in assets to its structured credit portfolio with the closing of its latest collateralized loan obligation.

The Babson CLO Ltd. 2012-II follows its $350 million predecessor which closed earlier this year and brings the firm’s total number of  collateralized debt obligations (including CLOs) to 53, representing $17.9 billion in AUM as of June 30, 2012.

“In the wake of the global financial crisis, investors have gained a greater  appreciation for the yield, safety and stability that CLOs offer, and their confidence is reflected in the resurgence of new CLO issuance this year,” said  Russell Morrison, managing director and head of high-yield investments for Babson Capital, in a statement. “The crisis also allowed investors to see more clearly than ever the critical difference collateral managers make in the performance of a CLO.”

As with the earlier CLO, Babson CLO Ltd. 2012-II consists primarily of corporate senior secured loans with a small amount of second-lien loans and high-yield bonds.

The transaction was arranged by Citigroup.

Babson Capital is a global investment management firm with $149 billion in assets under management.


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