UBS AG (UBS) and Mitsubishi UFJ Financial Group Inc. raised a $303 million collateralized loan obligation for Franklin Advisers Inc., according to two people with knowledge of the deal.
The fund, Muir Woods CLO, includes a $188.3 million slice rated AAA that has a coupon 152 basis points more than the London interbank offered rate, said one of the people, who asked not to be identified because the terms are private.
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. Libor is the rate at which banks say they can borrow in dollars from each other.
Torie von Alt, a UBS spokeswoman, and Stacey Coleman, a Franklin spokeswoman, didn’t return telephone calls seeking comment. A basis point is 0.01 percentage point.
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