Oz Firm Makes CDO Manager Debut

Grange Securities has launched its first self-managed collateralized debt obligation.

  • 15 Dec 2006
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Grange Securities has launched its first self-managed collateralized debt obligation. The AUD105 million deal, dubbed Kakadu, is being pitched in its local Australian market.

"This is a natural extension of our business as we've been doing the work anyway," saidMoray Vincent, director of debt capital markets in Sydney, adding this is the 43rd CDO Grange has distributed in the last four years. Grange has always reviewed its deals monthly as part of ongoing market support, giving it the necessary systems already in place. Vincent noted that Grange has a team of six in place that can handle the work and felt the firm has a competitive advantage because it understands the structures, compared to many CDO managers who come from a pure credit analysis background.

The paper launched Dec. 5 with JPMorgan as the swap counterparty. The seven year deal carries a AA rating and a coupon of BBSW (The Australian Financial Markets Association's bank-bill swap reference rate) plus 100 basis points for the first three years and plus 140 for the last four.

Grange is also in the process of working on another self-managed CDO with another dealer, though Vincent could not provide details at this stage. The firm selected the name Kakadu, a national park in Australia, to give the product a local feel. Previous issues have been named after Australian explorers, beaches, mountains and trees.

Lawrence Seah, v.p. structuring and solutions for Asia ex-Japan credit and rate markets at JPMorgan, declined to comment further on the deal.

  • 15 Dec 2006

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3 Bank of America Merrill Lynch 216,160.55 723 7.32%
4 Barclays 185,098.93 672 6.27%
5 Goldman Sachs 158,991.47 518 5.38%

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4 SG Corporate & Investment Banking 26,569.73 97 5.34%
5 Credit Agricole CIB 23,807.36 111 4.79%

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4 UBS 6,098.17 23 5.29%
5 Credit Suisse 5,236.02 28 4.54%