Paul Hastings Advised CVC Credit in Largest Ever Global CLO Equity Fund
July 06, 2023
Paul Hastings (Europe) LLP advised CVC Credit, the $41 billion global credit management business of CVC, in the establishment of CVC CLO Equity III, its third CLO equity fund. This is the largest vehicle of this type to date raised by CVC, with $800 million of commitments, and one of the largest fund raisings of its kind globally.
Across its period of deployment, this equity fund is intended to support over $10 billion of global CLO issuance for CVC Credit’s Performing Credit platform.
CVC CLO Equity III is CVC Credit’s third dedicated CLO equity vehicle and represents a significant increase over CVC Credit’s prior raises. It will be used to make equity investments in CVC-managed CLOs issued in the US and Europe. In aggregate, CVC Credit has now raised $1.66 billion of capital across its three CLO equity funds. CVC Credit pioneered the global risk retention fund structure with a first of its kind in December 2016 when it raised $600m from international institutional investors to support its CLO expansion in Europe and the U.S. CVC Credit raised a second fund in 2021.
Paul Hastings advised on both predecessor vehicles and worked closely with CVC Credit’s senior CLO team to develop an evolved legal structure on this third iteration that develops pre-existing technology in the area and can be expected to stand as a state-of-the-art model that other managers will seek to emulate.
Paul Hastings has also advised on more European CLO equity and risk retention funds than any other firm in the market. In addition to all three CVC funds, the firm has represented a substantial number of the major European and global CLO managers active in this area, including AlbaCore Capital, Alcentra, Acer Tree, AGL, Angelo Gordon, Ares, Fair Oaks, Fidelity, Hayfin, ICG, Neuberger Berman, OakHill and others.
It is also the most active CLO firm in Europe. Globally, the firm is ranked #1 Global CLO Arranger Counsel for 2022 by Creditflux – the sixth consecutive year the firm has been ranked in this leading position. The firm was credited for advising on 188 CLOs globally throughout 2022 – more than any other law firm and more than 44% of all CLOs globally – for a combined value of approximately US$87 billion.
Partner Christian Parker led the Paul Hastings team, which included Tax partners Jiten Tank in London and David Makso in New York, Structured Credit partners Cameron Saylor in London and Eugene Ferrer in New York, and Financial Regulatory partner Arun Srivastava in London. The lead associate on the transaction was Robert Williamson in London with further support provided by William Knox, Jee Yoon Chung, Rob Wilson, Tanja Nowak, and James Wilkins.
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