3i closes US$500 million CLO, Jamestown II

25 Feb 2013

3i Group plc (“3i” or “3i Group”), an international investor, today confirms the closing of a collateralised loan obligation (“CLO”) fund, Jamestown CLO II (“Jamestown II”).n Jamestown II, a US$500 million CLO, is the second CLO raised by 3i Debt Management US (“3iDM US”) since the business was established in August 2012.

An aggregate of US$460 million of investment grade debt was issued in six classes and, in addition, US$50 million of subordinated notes were issued. 3i Group has taken a minority stake in the subordinated notes.

Jamestown II is a refinancing of Fraser Sullivan CLO V (“FS CLO V”), a US$400 million CLO launched in February 2011 that has reached the end of its two-year reinvestment period. This refinancing will extend the investment period of the CLO fund and increase its size by US$100 million, and therefore this will generate further fee income for 3i. The strong performance of FS CLO V has resulted in a number of new and existing investors committing to Jamestown II.

Jamestown II will focus on investing in US corporate debt and in senior secured loans backing private equity buyouts in the US.

Simon Borrows, Chief Executive of 3i Group, commented: “Over the last eight months, we have made significant progress in growing and developing our Debt Management business, including the strategic transaction with Fraser Sullivan last year to establish 3i’s US debt management platform. Jamestown II is further evidence of the progress we are making to expand our Debt Management business and generate further income from third-party assets under management.”

Jeremy Ghose, CEO of 3i Debt Management said: “We continue to demonstrate the strength of our platform and our capabilities to successfully launch and close new funds. In the last four months, 3i Debt Management has successfully raised US$950 million.”

3i Debt Management has grown substantially since its launch in 2011. On a pro forma basis, the total assets under management ("AUM") of 3i's Debt Management business is approximately £5.1 billion compared to £3.4 billion at 31 March 2012 [1]. This demonstrates the strength of our platform and concrete progress against our objective to grow income from third-party assets under management over time.

 

For further information, contact:

3i
Kathryn van der Kroft
Tel: +44 20 7975 3021
kathryn.vanderkroft@3i.com

[1] This AUM excludes five CLOs where 3i is seeking investor consent for a transfer of management contracts from Fraser Sullivan, which would account for approximately £1.3 billion of additional AUM.

 

Notes to editors:

Jamestown CLO II

The transaction has a 4-year investment period and a non-call period of 2 years. The capital structure is as follows:

Tranche Size (US$m) Coupon Rating
Class A-1 Notes 307.5 LIBOR + 127 AAA
Class A-2A Notes 31.25 LIBOR + 185 AA
Class A-2B Notes 31.25 3.481% fixed rate AA
Class B Notes 42.5 LIBOR + 285 A
Class C Notes 28.0 LIBOR + 363 BBB
Class D Notes 19.5 LIBOR + 575 BB
Subordinated Notes 50.1 N/A N/A

Citigroup served as the Placement Agent.

 

About 3i Group

3i is a leading international investor focused on mid-market private equity, infrastructure and debt management across Europe, Asia and the Americas. For further information, please visit www.3i.com.

About 3i Debt Management

3i Debt Management, which was founded through the acquisition of Mizuho Investment Management in February 2011, specialises in the management of third-party funds investing in non-investment grade debt issued by medium and large European and US companies.