Canyon Partners Closes Two CLOs in US, Europe at Over $1B

Canyon Partners, a $25 billion LA-based credit hedge fund, has closed two collateralized loan obligations (CLOs) at more than $1 billion – a €550 million European CLO, Canyon Euro CLO 2023-1, and a $500 million U.S. CLO, Canyon CLO 2023-2.

Both will be managed by the firm’s affiliate Canyon CLO Advisors.

The deals, the fifth and sixth CLOs for Canyon CLO Fund III, were arranged by Jefferies and Deutsche Bank and bring the number of Canyon’s actively managed CLOs to 21, totaling nearly $10 billion in combined CLO/par loan separate account assets under management.

Both CLOs have a 2-year non-call period and 5-year reinvestment period and were structured to comply with European risk retention regulations.

The European CLO is the largest to clear the European market since November 2017 and the sixth largest European deal ever, according to the firm. This is the firm’s second European CLO since its debut in the market in 2023 and brings Canyon’s European CLO assets under management to approximately €1 billion.

The firm’s U.S. CLO represents the first U.S. new issue CLO of the year and was ramped over the course of 2023 and early 2024, “taking advantage of the volatility within the loan market to yield an attractive portfolio comprised of high-quality issuers,” the firm said.

Founded in 1990, Canyon takes a “credit intensive” approach across public and private corporate credit, structured credit, and direct real estate lending and investing.