HG bonds: Blue Owl Finance places upsized 2032 issue; terms

Blue Owl Finance LLC today completed an upsized $400 million offering of 4.375% 10-year notes due Feb. 15, 2032 at T+250. The issue was initially marketed at $300 million.

The issuer operates as an indirect finance subsidiary of Blue Owl Capital Inc., an alternative asset management firm focused on lending to private middle-market companies backed by private equity sponsors. Blue Owl made its debut on the NYSE in May 2021 after Owl Rock and Dyal Capital Holdings LLC formed the company through a merger via Altimar Acquisition Corp., a special purpose acquisition company.

Proceeds from today’s bond placement will be used for general corporate purposes, including funding any future strategic acquisitions or related growth initiatives, according to S&P Global Ratings. The agency earlier today assigned a BBB rating to the new 2032 notes, under a stable outlook for the ratings. “Pro forma for this issuance, we expect the company will operate with leverage, measured by net debt to adjusted EBITDA, below 1.5x during the next 18 to 24 months,” the agency said today.

The new issue will be fully and unconditionally guaranteed by Blue Owl Capital Holdings LP, Blue Owl Capital Carry LP, Owl Rock Capital Group LLC, Dyal Capital Holdings LLC, Owl Rock Capital GP Holdings LP, and Dyal GP Holdings LLC.

In November 2021, Fitch affirmed its BBB rating and stable outlook for parent Blue Owl Capital and Blue Owl Finance, reflecting the company’s solid market position in the direct lending and general partner capital solutions businesses, and its modest liquidity and balance sheet risk, among others.

Blue Owl Capital Finance last tapped the market in September 2021, when it placed a $350 million offering of 4.125% 30-year senior unsecured notes due Oct. 7, 2051, at T+220. In June 2021, it completed a $700 million offering of 3.125% 10-year notes due June 2031 at T+165.

Terms: