Sculptor Capital Management launches new CLO equity platform with Rithm Capital commitment

Sculptor Capital Management, Inc. (“Sculptor”) has announced the initiation of the Sculptor Loan Financing Partners, a new captive CLO (collateralized loan obligation) equity investment platform. This strategic development is significantly bolstered by a commitment from Rithm Capital Corp. (NYSE: RITM; “Rithm”), marking a major expansion of Sculptor’s Institutional Credit Strategies which currently manages approximately $15 billion in assets.

Concurrent with the launch, Sculptor also celebrated the closure of a $406 million US CLO, known as Sculptor CLO XXXII (“CLO 32”). A major portion of the equity in CLO 32 was pre-placed with Rithm through the new platform, alongside investments from a variety of leading global institutions in the minority equity and rated notes.

Brett Klein, Global Head of Corporate Credit at Sculptor, expressed enthusiasm about the launch: “Over the last decade plus, we have developed a highly successful global institutional credit business. We are thrilled to close our first US CLO transaction since partnering with Rithm. The significant demand from third-party investors for CLO 32 underscores the strategic benefit of launching a captive CLO equity platform.”

Michael Nierenberg, Chairman, Chief Executive Officer, and President of Rithm Capital, highlighted the strategic importance of the investment: “We are excited to support the expansion of Sculptor’s Institutional Credit Strategies through our commitment. This platform allows us to be nimble in accessing the CLO market when opportunities arise, continuing to scale Sculptor’s global CLO business across the US and Europe.”

Sculptor CLO 32 is backed by a fully ramped $400 million portfolio of primarily senior secured loans and features a five-year reinvestment period and a two-year non-call period. This launch builds on Sculptor’s capability to leverage current market conditions and actively manage its suite of CLOs.

Josh Eisenberger, Head of US CLO Management at Sculptor, noted the successful closure of CLO 32 along with three refinancing transactions in 2024: “The support from both new and existing investors as well as the competitive pricing achieved is a testament to our longstanding investment approach and expertise in CLO management.”

Sculptor has successfully managed CLOs through multiple credit cycles, issuing 42 CLOs & CBOs across the US and Europe since 2012. With a total of $24 billion in credit assets managed globally as of March 31, 2024, Sculptor continues to benefit from its extensive experience and robust partnership with its global opportunistic credit businesses. The firm remains optimistic about the ongoing growth and positive momentum of its Institutional Credit Strategies.

The launch of the Sculptor Loan Financing Partners platform represents a strategic enhancement of Sculptor Capital Management’s portfolio offerings. This initiative not only diversifies the firm’s investment strategies but also strengthens its position in the competitive CLO market, potentially setting new industry standards for asset management and investment opportunities in corporate credit.