Sector developments and company hires

Multi-currency CLO closed
Barclays has closed a multi-currency managed cashflow balance sheet CLO. Dubbed Duke Global Funding, the £4bn-equivalent transaction is backed by 519 senior secured and senior unsecured loans extended predominantly to large corporate obligors in Western Europe and the US. The underlying loans are denominated in US dollars, sterling and euro.

In terms of geographical diversification, the initial portfolio is concentrated mainly in the UK (50%) and the US (34%), with the remaining portfolio in Singapore, China, Canada, UAE, Qatar, Hong Kong and certain western European countries. The top five industries are construction & building (19.7%), beverage, food and tobacco (8.3%), banking (8.2%), insurance (6.6%) and telecommunications (6.6%). The portfolio will have certain maximum portfolio limits, including to project finance loans (15%), education loans (15%), corporate real estate loans (10%) and loans relating to trade finance transactions (10%).

The CLO is expected to be 100% ramped up, as of the closing date, and will be managed by Barclays. Subject to certain restrictions, it will direct the disposition of collateral on behalf of the issuer during the transaction's two-year reinvestment period, while the selection and acquisition of replacement loans will be subject to pre-defined selection criteria. Thereafter, purchases are permitted using principal proceeds from unscheduled principal payments and proceeds from sales of credit-impaired obligations.

Rated by Moody's, the transaction comprises £1.15bn Aa2 rated class A1 notes, US$1.94bn Aa2 rated class A2 notes and £1.44bn unrated subordinated notes. Each of the two rated classes of notes will receive interest and principal payments from the loans denominated in the same currency, as well as all proceeds from the euro-denominated assets.

In certain cases, if there is a shortfall in one of the currencies, then interest and/or principal proceeds will be converted from proceeds of loans denominated in the other currencies to ensure that any potential payment shortfall will be equally borne by both rated classes of notes. Following redemption of any of the rated classes of notes, proceeds from loans denominated in the same currency will be also used to make payments to the outstanding senior notes until such time that all rated classes of notes are fully redeemed.

In other news…

APAC
CMS has appointed new partner, Kingsley Ong, in its finance practice in Hong Kong. The arrival follows earlier expansion in the region with the appointment of capital markets and derivatives specialist, Christopher Whiteley, in July. Ong previously led Eversheds Sutherland’s structured finance, securitisation, and other practices in Asia. He will join the international law firm as leading financial restructuring partner as a part of CMS’s expansion and commitment to strengthen finance capabilities in Hong Kong.

North America
Capital markets fintech company dv01 has hired Sam Hillier as director of ESG. He will work closely with the team’s principal of strategy, Charlie Oshman to drive product development and innovation of dv01's ESG offering identify securities with outperforming characteristics. Hillier spent over 10 years at SEI Investments, where he evaluated and recommended sustainable investing strategies.

Hayfin has announced two further senior hires in latest bid to strengthen its North American investor base. Both Risa Lipsky and Chris Parisi have been appointed as managing directors within its business development team in New York. Risa Lipsky joins the firm from the private credit platform, Atalaya Capital, where she stood as managing director of business development and investor relations for five-years. Chris Parisi brings over 16 years of experience, having worked with insurance asset management clients at BlackRock as managing director within the Financial Institutions Group, and prior to this as vp within the insurance group at Goldman Sachs Asset Management. The new hires will work to boost client coverage and support the leading alternative asset management firm’s growth into the North American market.

Sabal Capital Holdings has announced the launch of its new CMBS trading business, SCH Trading. The new company will specialise in agency originated multifamily loans and offer an expansion to Sabal’s investment management business, SCPIM. The new trading platform, based in New York, will extend the financial services firm’s existing investment management operations, and will specialise in agency loan securities. SCH Trading will welcome George Geotes as head of the new CMBS business, who will bring over 17 years of experience in CMBS trading to the new platform.