The Clinton Group is trying to sell a $250 million pool of collateralized debt obligations, according to several Wall Street dealers considering making offers. Bids are due tomorrow. The list consists of seven CDOs, consisting of three CLOs, three trust preferreds and one asset-backed CDO. The bid list is of mostly senior, triple-A paper, with one single-A bond and one double-A bond on the list as well, according to CDO traders. Ted Petroulas, senior portfolio manager for structured finance, was on vacation and Patrick O'Meara, a spokesman for the New York hedge fund, did not return a call by press time last Friday.
Traders say it is unclear whether the bonds will all be placed, but add the list alone is an indication that the secondary market for CDOs continues to improve. "This is the biggest list since the Abbey [National ] stuff," says one CDO trader, referring to the more than $6 billion in CDO paper the British bank enlisted Pacific Investment Management Co. to sell earlier this year. He notes: "we wouldn't have seen this six months ago."
One analyst says unlike the Abbey sales, which were a gradual liquidation, Clinton Group's potential sale seems to be more of a repositioning of its portfolio. The hedge fund has roughly $10 billion under management.