BLUE OWL CAPITAL ANNOUNCES SENIOR NOTES OFFERING

Rhea-AI Summary

Blue Owl Capital Inc. announces the offering of 10-year senior unsecured notes through its subsidiary Blue Owl Finance , guaranteed by various entities within the Blue Owl group. The proceeds will be used to repay debt and for general corporate purposes, including potential acquisitions and growth initiatives.

Financial Analyst

Blue Owl Capital's move to issue 10-year senior unsecured notes is a strategic financial decision aimed at optimizing the company's capital structure. By electing to repay a portion of its revolving credit facility, the firm is likely trying to reduce its interest expenses and extend the maturity profile of its debt. This can be seen as a proactive measure to manage liquidity and leverage, especially in an environment where interest rates may be fluctuating.

The guarantee by multiple entities within the Blue Owl structure enhances the creditworthiness of the notes, potentially leading to more favorable borrowing terms. Investors should note, however, that the unsecured nature of the debt means that it ranks below secured debt in terms of claim on assets in a liquidation scenario. This could affect the risk assessment of the notes.

The intended use of remaining proceeds for strategic acquisitions or growth initiatives indicates an aggressive stance towards expansion and could signal future revenue growth. However, it also introduces the risk associated with the execution of these strategies and the integration of any potential acquisitions.

Debt Capital Markets Expert

The offering of notes to qualified institutional buyers under Rule 144A and to non-U.S. persons outside the United States under Regulation S suggests a targeted approach to fundraising, focusing on sophisticated investors who are accustomed to evaluating such investments. This could help streamline the offering process and ensure a more efficient capital raise.

The lack of registration under the Securities Act indicates that these notes will be subject to resale restrictions, which could limit liquidity for investors. However, the proposed registration rights agreement could alleviate some of these concerns by providing a pathway to greater liquidity through an eventual public offering of the notes.

Investors should be aware that the timing of the registration rights agreement—within 365 days—will be critical to monitor, as any delays could impact the liquidity and marketability of the notes. The terms of such an agreement will be key in evaluating the potential for future liquidity of the notes.

Market Research Analyst

The announcement of Blue Owl Capital's note offering comes at a time when the debt markets may be sensitive to interest rate changes and economic indicators. The market's reception of this offering could serve as a barometer for the current appetite for corporate debt, especially unsecured notes from financial firms.

By analyzing historical data and current market conditions, one can infer potential investor sentiment towards this offering. A successful issuance at a competitive interest rate could indicate confidence in Blue Owl's financial health and strategic direction. Conversely, a less favorable outcome might suggest market concerns over credit risk or broader economic uncertainties.

Furthermore, the use of proceeds for potential acquisitions will be closely watched by the market, as such moves can significantly alter competitive dynamics within the industry. Tracking peer reactions and subsequent market performance can provide insights into the perceived value of such strategic decisions.

NEW YORK, April 11, 2024 /PRNewswire/ -- Blue Owl Capital Inc. ("Blue Owl") (NYSE: OWL) today announced that its indirect subsidiary, Blue Owl Finance LLC, intends to offer 10-year senior unsecured notes (the "notes"), subject to market and other conditions. The notes will be fully and unconditionally guaranteed by each of Blue Owl, Blue Owl Capital GP Holdings LLC, Blue Owl Capital GP LLC, Blue Owl Capital Holdings LP, Blue Owl Capital Carry LP, Blue Owl Capital Group LLC, Blue Owl GPSC Holdings LLC, Blue Owl Capital GP Holdings LP, Blue Owl GP Stakes GP Holdings LLC, Blue Owl Real Estate Holdings LP, Blue Owl Real Estate GP Holdings LLC and Blue Owl Capital Holdings LLC. Blue Owl intends to use the net proceeds from this offering to repay a portion of outstanding borrowings under its revolving credit facility. Any remaining net proceeds will be used for general corporate purposes, including to fund any future strategic acquisitions or related transactions and growth initiatives.

The notes will be offered and sold to persons reasonably believed to be qualified institutional buyers pursuant to Rule 144A and to non-U.S. persons outside the United States pursuant to Regulation S under the Securities Act of 1933, as amended (the "Securities Act").

The notes have not been registered under the Securities Act or any state securities laws and, unless registered, may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction subject to, the registration requirements of the Securities Act and applicable state securities laws. The Company also intends to enter into a registration rights agreement in connection with the offering of the notes, under which it will agree to consummate an offer to exchange the notes pursuant to a registration statement filed with the Securities and Exchange Commission within 365 days after the original issue date of the notes.

This press release shall not constitute an offer to sell or a solicitation of an offer to purchase the notes or any other securities and shall not constitute an offer, solicitation or sale in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful.

About Blue Owl Capital

Blue Owl (NYSE: OWL) is a leading asset manager that is redefining alternatives.

With over $165 billion in assets under management as of December 31, 2023, we invest across three multi-strategy platforms: Credit, GP Strategic Capital, and Real Estate. Anchored by a strong permanent capital base, we provide businesses with private capital solutions to drive long-term growth and offer institutional and individual investors differentiated alternative investment opportunities that aim to deliver strong performance, risk-adjusted returns, and capital preservation.

Together with over 685 experienced professionals globally, Blue Owl brings the vision and discipline to create the exceptional.

Forward-Looking Statements

Certain statements made in this press release are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words "estimates," "projected," "expects," "anticipates," "forecasts," "plans," "intends," "believes," "seeks," "may," "will," "would," "should," "future," "propose," "target," "goal," "objective," "outlook" and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. Any such forward-looking statements are made pursuant to the safe harbor provisions available under applicable securities laws and speak only as of the date made. Blue Owl assumes no obligation to update or revise any such forward-looking statements except as required by law.

These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside Blue Owl's control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements.

Important factors, among others, that may affect actual results or outcomes include the inability to recognize the anticipated benefits of strategic acquisitions; costs related to acquisitions; the inability to maintain the listing of Blue Owl's shares on the New York Stock Exchange; Blue Owl's ability to manage growth; Blue Owl's ability to execute its business plan and meet its projections; potential litigation involving Blue Owl; changes in applicable laws or regulations; and the possibility that Blue Owl may be adversely affected by other economic, business, geo-political and competitive factors.

Investor Contact
Ann Dai
Head of Investor Relations
blueowlir@blueowl.com

Media Contact
Prosek Partners
David Wells / Nick Theccanat
Pro-blueowl@prosek.com

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SOURCE Blue Owl Capital

FAQ

What is Blue Owl Capital Inc. announcing?

Blue Owl Capital Inc. is announcing the offering of 10-year senior unsecured notes through its subsidiary, Blue Owl Finance

Who will guarantee the notes?

The notes will be fully and unconditionally guaranteed by various entities within the Blue Owl group.

How will the proceeds from the offering be used?

The net proceeds from the offering will be used to repay a portion of outstanding borrowings under Blue Owl's revolving credit facility and for general corporate purposes, including potential acquisitions and growth initiatives.

What type of investors will the notes be offered to?

The notes will be offered and sold to qualified institutional buyers under Rule 144A and to non-U.S. persons outside the United States under Regulation S.

Are the notes registered under the Securities Act?

No, the notes have not been registered under the Securities Act or any state securities laws.