CVC scores CLO risk retention win

Author: Amélie Labbé | Published: 18 Jul 2017

CVC Credit Partners is one of the first collateralised loan obligation (CLO) managers to have secured third party equity investment to comply with US and EU risk retention rules. It is also the first to get this investment in its capacity as a collateralised loan (CLO) obligation sponsor as opposed to as an originator.

The company, an affiliate of private equity giant CVC Capital, raised $600 million from a number of investors including sovereign wealth funds, family offices and investment banks to fund its CLO manager. CVC Credit Partners Global CLO Management Limited will have the exclusive right to take majority positions in CLO equity of CVC Credit Partners’ US and European CLOs in compliance with the so-called five percent skin in the game rule.

In the UK, CVC Credit Partners Global CLO Management Limited has established, in Europe, a Financial Conduct Authority-authorised Mifid [Markets in Financial Instruments Directive] manager and in...