Two European loan asset managers are raising debt for collateralized loan obligations. AIB Acquisition Finance, a unit of AIB Capital Markets established to arrange and invest in leveraged finance transactions, is in the market with Galway Bay, a $471 million CLO, with Morgan Stanley underwriting the notes. Intermediate Capital Managers, a U.K.-based asset manager that moved away from bond deals to loan deals (LMW, 11/17), is raising debt for Eurocredit CDO III, a $270 million deal underwritten by Credit Suisse First Boston. Both deals will invest in the burgeoning European leveraged loan market.
Galway Bay will be AIB's third CDO. The two existing transactions contain a proportion of high-yield bond collateral, but Galway Bay is expected to focus entirely on senior secured and mezzanine loans, according to Standard & Poor's. AIB intends to retain at least 20% of the equity of Galway Bay. Officials at AIB and Intermediate declined comment on the transactions, noting the deals are in the marketing phase.