The Blackstone Group (NYSE:BX) today announced the closing of three
newly created collateralized loan obligation funds ("CLOs")
totaling $1.3 billion, all created over the past month. In March, the
firm merged its pre-existing CLO management group with the team from its
newly acquired GSO Capital Partners. The 35 person CLO team maintains
offices in New York and London.
With this new capital, the combined CLO group manages $14.0 billion
across 26 funds in the US and Europe. The new CLOs closed by the group
were Columbus Park ($400 million) on April 3rd, Riverside Park ($500
million) on April 15th and Tribeca Park ($400 million) on May 1st.
According to Standard and Poors´, during the first three months of 2007
48 CLOs were created with total volume of $24.8 billion, compared to
only 11 new CLOs with aggregate volume of $6.0 billion in the first
three months of 2008, a drop of 76%. While all aspects of the credit
markets have experienced a degree of dislocation, Blackstone believes
the limiting factor in creating new CLOs is most directly related to the
lack of supply for the CLOs´ most senior
capital tranche, AAA-rated liabilities. These liabilities represent
approximately 70% to 75% of a generic CLO´s
capital structure and recently have been available to only the most
highly regarded asset managers.
"The market´s
positive reception to our recent offerings demonstrates the growth
potential for our CLO business", said Bennett
Goodman, Senior Managing Director and head of Blackstone´s
GSO division. Goodman continued, "These
investment vehicles are very different from most CLOs issued recently.
They have been established to buy high quality loan assets with an
expectation for stable returns to all investors in the CLO´s
capital structure. This is in contrast to the majority of CLOs issued
since last summer, which were established primarily to move risky assets
off banks´ balance sheets."
About The Blackstone Group
The Blackstone Group L.P. is a leading global alternative asset manager
and provider of financial advisory services. Its alternative asset
management businesses include the management of corporate private equity
funds, real estate funds, funds of hedge funds, mezzanine funds, senior
debt vehicles, proprietary hedge funds and closed-end mutual funds. The
Blackstone Group L.P. also provides various financial advisory services
including corporate and mergers and acquisitions advisory, restructuring
and reorganization advisory and fund placement services. Further
information is available at www.blackstone.com
