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Refinancing, Simplified.
CLO Refinancing Platform
What is AMR?
AMR, Applicable Margin Reset, is a multi-dealer online
auction that refinances CLO liabilities at a fraction of the
traditional cost and time. AMR does not require issuance
of new securities, thus cutting expenses and time delays.
Compared to single-dealer underwriting, AMR auctions
provide additional liquidity through multi-dealer syndication.
Why is CLO
refinancing important?
While some may think that CLO Managers’ primary job is to
focus on selecting assets, managing CLO liabilities is equally
important for CLO returns. CLO assets are leveraged loans
which are highly callable. Leveraged loan repricing can lead
to uneconomic risk/return outcomes for a CLO. The ability to
adjust the cost of liabilities frequently and economically is
the key to successful CLO management.
Why is CLO
refinancing important?
While some may think that CLO Managers’ primary job is to focus on selecting assets, managing CLO liabilities is equally important for CLO returns. CLO assets are leveraged loans which are highly callable. Leveraged loan repricing can lead to uneconomic risk/return outcomes for a CLO. The ability to adjust the cost of liabilities frequently and economically is the key to successful CLO management.
AMR
Benefits The
Marketplace
Equity investors
lower refinancing costs and acquire the option to refinance debt tranche by tranche
Debt investors
gain broader market access and the ability to place multiple bids at different margins
CLO managers
save time via broad, efficient syndication and obtain insights from auction data
Broker-dealers
secondary desks get access to a formerly primary market
$6.8 Bn
AMR Deals
in the Market
$4.8 Bn
Bids Posted
in AMR Auctions
17
Platform
Broker-dealers
…Buyers of CLO equity may press to use KopenTech’s technology... There were $25 billion of CLO refinancings last year. If all had gone the auction route, equity investors would have saved tens of millions of dollars.
AMR on Wiki
Read detailed information about AMR on Wikipedia.
Cost Savings
- 4 AMRs for the cost
of 1 traditional refinancing - Competitive execution
through secondary markets - Deal documentation
remains the same
Time Reduction
- Full timeline is 10 days, with
only 5 days of pricing risk - Financial and operational risks
reduced through fast execution
Insightful Data
- Detailed auction data helps
CLO managers plan issuance
more effectively - Multi-dealer auction format
yields extensive origination
insights
AMR Auction Results
View historical data from
past AMR auctions.
AMR Timeline
10 Days From
Initiation to Completion
4d
Initiation
The CLO manager or
majority equity investor(s)
initiates AMR
refinancing after
the
non-call period ends.
1d
Auction
Investors confidentially
submit bids through
a platform broker-dealer.
KopenTech
aggregates,
calculates and publishes
results.
5d
Settlement
Securities are
transferred via DTC to
auction winners.
The
trustee publishes
the
pricing supplement.
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