Blue Owl Capital, Blue Owl Capital Corporation II announce termination of merger

Blue Owl Capital (OWL) (OBDC) and Blue Owl Capital Corporation II announced that the previously proposed merger of OBDC and OBDC II has been terminated, with plans to reevaluate alternatives in the future. This decision reflects the Boards’ commitment to acting in the best interests of shareholders and is based on management’s recommendation due to current market conditions. “While we continue to believe that combining OBDC and OBDC II could create meaningful long-term value for shareholders, we are no longer pursuing the merger at this point given current market conditions,” said Craig W. Packer, Chief Executive Officer of OBDC and OBDC II. “Both funds remain strong, with excellent fundamentals, and we are confident in our ability to deliver attractive returns independently as we continue to work with the Board to consider the best future opportunities for OBDC II.” Subject to Board approval, OBDC II plans to reinstate the tender program in Q1 of 2026. Since inception in 2017, OBDC II has delivered a nearly 80% cumulative net return and a 9.3% annualized net return, meaningfully outperforming broadly syndicated loan and high yield indices, and every quarterly tender has been fully satisfied. OBDC II’s strong investment results are supported by an unwavering focus on credit quality, highlighted by a loss rate since inception of 23 basis points and current non-accrual rate of less than 2% of the portfolio at fair value. In addition, OBDC’s $200M share repurchase program that was announced concurrently with the merger remains in place.