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Bain’s Sankaty Advisors launches $325m CLO fund

24 Jan 2014

dollar envelope moneyBain Capital’s credit unit Sankaty Advisors has launched its first fund focused on collateralized loan obligations (CLO).

Sankaty CLO Partners 1 is a $325m vehicle that will invest in CLOs in the US and Europe, Sankaty managing director John Wright told Bloomberg.

He said that the firm started raising the fund before the Volcker Rule, which could bar banks from investing in CLOs that hold bonds.

It is estimated that banks currently hold around $70bn of CLOs, which buy loans used to back leveraged buyouts and issuance soared 42 per cent to $82bn last year, said the report.

Wright said that investors that face regulation may be apprehensive to get into the market and that offers opportunities for those that aren’t regulated.

Last month AltAssets reported that Sankaty Advisors’ second mid-market fund is nearing its $1.5bn hard cap.

Sankaty, which currently has $19.4bn under management, invests in leveraged loans, high-yield bonds, distressed/stressed debt, mezzanine debt, structured products and equities.

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