Merrill Raises Debt For Franklin CLO

Merrill Lynch has priced the notes for Franklin Templeton Investment's fourth collateralized loan obligation, the $306 million Franklin CLO IV. The $256 million triple-A tranche is priced at LIBOR plus 55 basis points, said a source. A Merrill Lynch spokesman declined to comment, noting the deal is a private placement. Richard D'Addario, senior portfolio manager at Franklin, was traveling. A spokeswoman did not return calls. The deal is said to have been initiated after reverse inquiry from equity investors in the firm's previous deals (LMW, 4/27). One investor said none of the firm's three previous CLO deals have been downgraded, while the equity returns have been north of 20%.