Barings debuts first European mid-market private credit CLO
Barings has launched the first ever European middle market private credit collateralised loan obligation (CLO) at €380m (£316.58m).
The CLO is backed by a portfolio of European middle-market senior secured loans, Barings said. It is the first of its kind in the market, and the result of a combined effort between Barings’ global CLO team and Barings’ global private finance group.
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“As an experienced leader in the market, Barings is proud and excited to be a first mover in the evolution of CLOs in Europe,” said Adrienne Butler, head of global CLOs at Barings.
“To date, the difficulty in creating a diversified portfolio has prevented a true middle market CLO from being executed in Europe.
“We have noted investor interest in this space for several years, and having issued seven US middle market CLOs since 2017, Barings has the knowledge and expertise to provide a solution in this untapped area of the market.”
Read more: Barings’ European private credit unit has deployed €1.5bn this year
“Due to Barings being a leading European direct lender, we were able to create a diversified portfolio of nearly 50 private credit loans representing eight countries, in addition to a European BSL bucket to add to the diversification,” added Joe Evanchick, head of middle market CLOs at Barings.
“Our extensive sponsor relationships resulted in the Barings European private credit platform closing over €13bn across 153 senior transactions with 64 different sponsors in the last three years.”
The Euro Middle Market CLO will be rated by both S&P and Fitch. It is a static deal with a one-year non-call period. BNP Paribas served as the arranger.
Read more: Barings launches first Australian private credit fund
