Blue Owl has decided to telephone disconnected the merging of 2 of its private-credit funds aft the woody caused immoderate angst among investors, according to radical acquainted with the matter.
The steadfast had planned to merge its smaller, non-traded Blue Owl Capital Corporation II (OBDC II), into the larger, publically traded money Blue Owl Capital Corporation (OBDC). In doing so, the steadfast restricted investors successful the $1.7 cardinal OBDC II from redeeming until the woody closed, adjacent arsenic the merger would person meant astir 20% insubstantial losses, based connected wherever the $17.1 cardinal OBDC has been trading.
News of the restricted redemptions caused shares of the genitor institution – Blue Owl Capital to slump astir 6% connected Monday. It besides added to concerns astir the authorities of the backstage recognition manufacture among investors, particularly the country that has started to heavy concern the AI datacenter buildout that galore fearfulness is overhyped. Blue Owl shares rebounded somewhat connected Tuesday.
The boards of the 2 firms did not spot the benefits of merging the funds arsenic outweighing the volatility and antagonistic headlines that came from quality of the deal, according to the people. Therefore, they chose to reverse course, sources said.
Blue Owl, 1 month
Now that the money merger has been terminated, OBDC II volition let investors to redeem successful the archetypal quarter, said the people, who asked not to beryllium named discussing non-public information. The money historically has allowed liquidity connected a quarterly basis.
They program to denote the thwarting of the woody arsenic soon arsenic today, the radical said.
Blue Owl shares jumped 2% successful premarket trading Wednesday.
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