Owl Rock Capital Partners LP and Dyal Capital Partners agreed to merge into a complicated business that would make them public through a blank check company.
The new company, to be called Blue Owl, would combine one of the largest private equity holders with Owl Rock, a fast-growing credit investor. It would be valued at about $ 12.5 billion.
The Wall Street Journal reported earlier this month that companies were discussing such a deal.
The companies plan to go public through a merger with the acquisition of Altimar Corp.
, a special purpose acquisition company sponsored by an affiliate of HPS Investment Partners LLC. The deal also includes additional funds from about $ 1.5 billion from institutional investors.
Blue Owl would be led by Owl Rock co-founder Doug Ostrover as chief executive.
SPAC mergers have recently exploded in popularity as an alternative to traditional initial public offerings. This deal, assuming the shareholders approve it, would be one of the largest transactions of its kind. It is the second largest SPAC transaction announced in the United States this year, eclipsed only by an agreement to make public the originator of the United Wholesale Mortgage mortgage with a valuation of approximately $ 16 billion.
The deal is also one of the few cases of merger of two companies and one SPAC simultaneously. DraftKings sports betting operator Inc.
merged with a gambling technology provider as part of a business that made it public through a SPAC earlier this year.
Dyal was founded in 2011 by Lehman Brothers veterans Michael Rees and Sean Ward and is the largest owner of minority stakes in private equity firms, credit stores and hedge funds. She already has interests in Owl Rock and HPS.
Throughout its existence, Dyal has been a unit of Neuberger Berman Group LLC, the large privately held investment company. Neuberger would retain a stake in Blue Owl and take a seat on the board.
Owl Rock was founded in 2016 by Mr. Ostrover, who co-founded GSO Capital Partners and later sold it to Blackstone Group; former KKR & Co. partner Marc Lipschultz; and the former Goldman Sachs Group Inc.
banker Craig Packer. It soared to $ 23.7 billion in assets, managed mainly by business development companies.
The company focuses on a fast-growing area known as direct lending, in which non-bank institutions lend to midsize companies, many of which are guaranteed by private equity, and keep them in their books. These creditors have been on the rise since the aftermath of the 2008-09 financial crisis, when banks abandoned many of their riskier businesses.
Perella Weinberg Partners LP, Goldman Sachs & Co. LLC and BofA Securities Inc. are financial advisors to Owl Rock. Ardea Partners LP is a financial advisor to Neuberger Berman and Dyal; Evercore Group LLC is a financial advisor to Dyal; and JP Morgan Securities LLC is a financial advisor to Altimar. Citigroup and UBS are also advising Neuberger Berman.
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