Blackstone to Reportedly Buy Insurer Titan AIG’s $3.6B CLO Assets

Blackstone Inc. has brokered a deal to buy $3.6 billion collateralized-loan obligation (CLO) assets of insurer American International Group (AIG), Bloomberg reported.

The deal, according to its sources, makes Blackstone the largest manager of CLOs. Prior to this deal, global investment firm Carlyle Group was the largest player in the $1.2 trillion CLO market.

Following the acquisition of AIG’s CLO assets, Blackstone will have approximately $51 billion CLOs in its portfolio.

Bloomberg said Blackstone and AIG refused to offer any comment on the development.

Blackstone plans to maintain the purchased CLO shop as a separate venture from its current platform. In addition to the assets, some employees will also join Blackstone.

AIG, which was bailed out by the US government during the 2008 financial crisis, had divested its asset management business to Pacific Century Group in 2010. The divested unit was rebranded as PineBridge Investments LLC.

In 2018, the insurer returned to the CLO management business with the acquisition of Covenant Credit Partners. Covenant Credit Partners was a small CLO manager headed by Marc Boatwright with $900 million in assets.