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Palmer Square Capital Management, one of the largest US issuers of collateralized loan obligations, is exploring a sale of its roughly $37 billion credit business. The firm has engaged banking advisors to sound out potential buyers, according to a Bloomberg report.
The discussions are still in early stages, with negotiations described as confidential.
A CLO giant built from scratch
Palmer Square was founded in 2009 by Chris Long, who serves as chairman and CEO, and his wife Angie Long, the firm’s chief investment officer. The couple met at Princeton and previously worked together at JPMorgan Chase before striking out on their own.
Over the past 15 years, the firm grew from a startup into a global CLO issuer with offices extending to London. Of its approximately $37 billion in assets under management, roughly $27 billion sits in its CLO platform.
Beyond CLOs, Palmer Square runs strategies across opportunistic credit, income and short-duration products, and private credit. The firm also manages a publicly traded business development company, Palmer Square Capital BDC Inc., which provides direct lending to middle-market companies.
The CLO market’s remarkable expansion
The US CLO market has quadrupled in size to more than $1.3 trillion over the past 15 years, transforming from a niche pocket of structured finance into a mainstream institutional allocation.
The demand for floating-rate, senior secured loan exposure has been a tailwind for CLO issuance broadly. When rates rise, floating-rate instruments become more attractive relative to fixed-rate bonds, channeling fresh capital into CLO structures.
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