Canyon Partners has raised $400m (£298.5m) for its fourth collateralised loan obligation (CLO) equity fund, exceeding its $300m target.
The $29bn global alternative investment manager said CLO Fund IV will primarily acquire majority equity positions in Canyon-issued US and European CLOs, with the ability to invest in primary and secondary mezzanine tranches.
The fund attracted commitments from a global base of investors, including pension funds, insurance companies, endowments, foundations, registered investment advisers and family offices, according to the Dallas-headquartered firm.
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Canyon said the fund builds on its three previous CLO equity vintages, with more than 70 per cent of investors in CLO Fund III also committing to CLO Fund IV.
“The closing of CLO Fund IV comes amidst one of the most active periods in our 25-year CLO history, and we are eager to have the opportunity to continue to leverage our differentiated approach to credit selection and portfolio management for the benefit of our CLO investors,” said Erik Miller, partner and co-head of Canyon’s CLO business.
At final close, CLO Fund IV was already 50 per cent deployed, with Canyon issuing five CLOs across the US and European markets over the past year, a period marked by limited new-issue loan supply and heightened volatility.
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“Temporary market dislocations provide our team with more opportunities to apply our active approach and trading DNA to seek to enhance performance through tactical issuer and sector adjustments,” said Martin Downen, partner and co-head of Canyon’s CLO business.
Canyon has launched and managed 34 CLOs and CDOs since 2001 and currently has $12bn in assets under management within the investment class.
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