Salomon Smith Barney has sold the notes for Prudential Capital Group's $303.75 million collateralized loan obligation Dryden 2002-3. The deal is the second this year for Ross Smead's leveraged bank loan group at Prudential, which raised debt for the Dryden Leveraged Loan CDO in July. The deal is 80-90% composed of leveraged loans and there is a 10% high-yield bond bucket. Another analyst explained the Triple-A notes for the new deal carry two different spreads, as one tranche has a shorter weighted average life than the other tranche. She added that the Aa2/AA tranche is priced off the swaps curve to accommodate an investor looking for fixed rate rather than floating-rate paper. Smead declined comment on the deal.
| How It Priced* | |||
| Rating | Tranche Size | Spread | WAL* |
| Aaa/AAA | $188 million | LIB+53 | 6 |
| Aaa/AAA | $30 million | LIB+70 | 7.5 |
| Aa2/AA | $25 million | Swap+90 | 8 |
| A3/A- | $15 million | LIB+190 | 8.5 |
| Baa2/BBB | $13 million | LIB+300 | 9 |
| Ba2/BB | $10 million | LIB+825 | 9 |
| Equity | $22.75 million | . | . |
| *Weighted Average Life |