Bear Stearns is talking to equity investors in collateralized loan obligations for Octagon Credit Investors' Octagon VI deal. A source said the CLO will likely be in the $300-400 million range and will start warehousing assets in the summer. Octagon is the leveraged loan and high-yield manager subsidiary of J.P. Morgan Partners. Officials at Octagon declined comment and a Bear Stearns CDO banker did not return calls.
Though recently several new leveraged loan players, such as Callidus Capital Management, have raised debt for deals, the move is more in keeping with the trend of repeat issuers attempting their fourth, fifth or even sixth deals, a source noted. Prudential Capital Group, Franklin Templeton Investments, and Sankaty Advisors have all recently priced deals or are in the market raising debt.