In this alert memorandum, Cleary Gottlieb considers the application of the market soundings regime under the Market Abuse Regulation (“MAR”) in the context of CLOs and in particular the refinancing of an existing tranche.
MAR came into force on 3 July 2016, and there has been considerable market uncertainty regarding the application of the market soundings regime, which has the potential to drastically increase the regulatory burden on banks and investors participating in market soundings.