The world’s largest private equity firm Blackstone Group and Los Angeles–based investment firm Ares Management are heading an expansion in European collateralized loan obligations (CLOs), Bloomberg reports. U.S. firms are acquiring dormant CLOs unable to raise funds in Europe as deal flow in the buyout market has shrunk 76 percent since July.
The firms are aiming to boost fee income from managing assets. Blackstone’s debt unit GSO Capital Partners with $15 billion worth European loans under management became the largest manager of CLOs in Europe after taking over Dublin-based Harbourmaster Capital Management in early October.
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