Bloomberg News

Citigroup Is Said to Lower Proposed Interest Rate on Apollo CLO

January 23, 2012

Jan. 20 (Bloomberg) -- Citigroup Inc. has lowered the proposed interest rate on a $35 million slice of a collateralized loan obligation that the bank is raising for Apollo Global Management LLC, according to two people with knowledge of the deal.

The Aa2 slice of the CLO, which has a target size of $400 million, may now pay an interest rate of 310 basis points to 330 basis points more than the London interbank offered rate, said the people, who declined to be identified because the terms are private. Initial price guidance had been 325 basis points to 350 basis points more than the benchmark, a rate at which banks say they can borrow in dollars from each other.

CLOs are a type of collateralized debt obligation that pool high-yield, high-risk loans and slice them into securities of varying risk and return.

Scott Helfman, a Citigroup spokesman, and Melissa Mandel Kvitko, a spokeswoman for Apollo, declined to comment.

--Editors: Dennis Fitzgerald, Faris Khan

To contact the reporter on this story: Kristen Haunss in New York at khaunss@bloomberg.net

To contact the editor responsible for this story: Faris Khan at fkhan33@bloomberg.net


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