Clearlake Capital Group LP successfully raised $1 billion through a collateralized fund obligation (CFO) after restructuring the deal following investor discussions. The trade, adjusted to improve pricing and reduce the debt-to-equity ratio, sees a new CFO issuer hold $600 million in private credit exposure, $200 million in a private equity secondaries fund, and another $200 million private equity fund stake as collateral. Against these assets, the firm raised $775 million in Class A, B, and C bonds and $225 million in equity.

Goldman Sachs Group Inc. served as the sole structuring and placement agent. A key adjustment saw the Class A bonds priced at 285 basis points over SOFR, 15 basis points lower than initial expectations. The Class C debt carries a rate of 800 basis points over SOFR, while the equity portion is expected to generate an internal rate of return of approximately 18%.

This restructuring follows a broader trend of asset managers turning to CFOs for liquidity amid an M&A deal drought. The secondary market for private assets has boomed, with figures like Ahmet Yetis of Evercore predicting new CFO volumes could top $30 billion this year, a 50% increase from 2025.