EU CLO Managers: Seasoned Deals’ Accrued Incentive Fees
Managing CLOs in Europe is a fairly capital-intensive business given the risk-retention requirement. Are EU CLO managers getting paid well for all the work of putting together a CLO and managing it?
The table below shows the list of managers who did well and have accrued incentive fees as of Jun/Jul/Aug payment dates thanks to the outstanding investment performance of their seasoned deals closed from 2013 to 2018. For deals with Aug payment dates, expected Aug payments are included in the incentive fee calculation, and 12 Aug loan prices are used to calculate equity NAV (clean NAV is used).
| CLO Managers | Incentive Fees Accrued (EUR million) |
| Barings | * |
| BlackRock Financial Management | * |
| Cairn Capital | * |
| Carlyle Group | * |
| CVC Credit Partners | * |
| HPS Investment Partners | * |
| Intermediate Capital Group | * |
| Prudential Financial (Pramerica) | * |
| Spire Partners | * |
| Total | 40.55 |
Source: Intex, LPC, CLO Research
Excluding 2013 deals, the total incentive fees accrued would be EUR34.40 million or around USD 42 million.
Disclaimers
The information, research, data, research-related opinions, observations, and estimates contained in this document have been compiled or arrived at by CLO Research Group, based upon sources believed to be reliable and accurate, and in good faith, but in each case without further investigation. None of CLO Research Group or its service providers; authorised personnel, or their directors make any expressed or implied presentation or warranty, nor do any of such persons accept any responsibility or liability as to the accuracy, timeliness, completeness, or correctness of such sources and the information, research, data, research related opinions, observations and estimates contained in this document. All information, research, data, research-related opinions, observations, and estimates in this document are in draft form as of the date of this document and remain subject to change and amendment without notice. Neither CLO Research Group nor any of their third-party providers shall be subject to any damages or liability for any errors, omissions, incompleteness, or incorrectness of this document. This article is not and should not be construed as an offer, or a solicitation of an offer, to buy or sell securities and shall not be relied upon as a promise or representation regarding the historical or current position or performance of any of the deals or issues mentioned in it.
