- Owl Rock and Dyal to combine to form Blue Owl, a differentiated
alternative asset manager with industry leading Direct Lending and
GP Capital Solutions businesses
- Combined firm to manage over $45.0 billion in assets
- Blue Owl to become publicly listed through a business
combination with Altimar, a SPAC sponsored by an affiliate of HPS
Investment Partners (NYSE:ATAC)
- Blue Owl is expected to be listed on the NYSE under the ticker
symbol “OWL” following the expected close of the transaction in the
first half of 2021
- Transaction expected to provide approximately $1.8 billion in
gross proceeds, comprised of Altimar’s $275 million of cash held in
trust (assuming no redemptions) and a $1.5 billion fully committed,
oversubscribed, common stock PIPE at $10.00 per share, including
investments from ICONIQ Capital, CH Investment Partners, Koch
Companies Defined Benefit Master Trust, the Federated Hermes
Kaufmann Funds, and Liberty Mutual Investments
- The founders and senior managers of Blue Owl will retain their
equity stakes through the combined entity’s transition into a
publicly listed company, promoting continued alignment
Owl Rock Capital Group (“Owl Rock”) and the Dyal Capital
Partners (“Dyal”) division of Neuberger Berman Group LLC
(“Neuberger Berman”) today announced they entered into a definitive
business combination agreement with Altimar Acquisition Corporation
(NYSE: ATAC) (“Altimar”) to form Blue Owl Capital Inc. (“Blue
Owl”), an alternative asset management firm with over $45.0 billion
in assets under management.
Blue Owl will enter the public market through a business
combination with Altimar, a special purpose acquisition company
sponsored by an affiliate of HPS Investment Partners, LLC. The
combined entity is expected to have a post-transaction market
capitalization of approximately $12.5 billion. As a result of the
transaction, Blue Owl is expected to be listed on the NYSE under
the new ticker “OWL”.
The new firm’s main business will focus on two of the fastest
growing areas of alternative asset management: Direct Lending,
where Owl Rock is one of the leading private credit providers to
middle and upper middle market businesses backed by top-tier
financial sponsors, and GP Capital Solutions, where Dyal has been a
leader and innovator since its founding. The Owl Rock and Dyal
businesses will be autonomous but complementary. By bringing
together two preeminent businesses in their respective fields, Blue
Owl will be positioned as a differentiated provider of holistic
solutions to the alternative asset management community. Each
business will be led by its current long-tenured management, and
its respective investment teams will continue to employ the
disciplined investment philosophies that they have delivered since
inception.
Doug Ostrover, co-founder of Owl Rock, will serve as Chief
Executive Officer of Blue Owl. On the announcement of the strategic
combination, he stated: “Blue Owl’s expertise, agility and scale,
supported by a substantial permanent capital base, will enable us
to offer a holistic platform of capital solutions to private equity
firms and privately held businesses. We believe this will broaden
and deepen our relationships and provide us with unrivaled access
to compelling investment opportunities. In addition, this permanent
capital base will allow Blue Owl to continue to strongly grow its
business in a consistent and predictable manner. The foundation of
our success is the trust our clients and partners place in us based
on our experience, investment approach, and commitment to serving
them. We look forward to solidifying our position as the capital
partner and investment manager of choice for our stakeholders.”
Michael Rees, Dyal founder, and Marc Lipschultz, Owl Rock
co-founder, will be co-Presidents of Blue Owl. Rees said: “Our
businesses will combine robust growth and a strong margin profile
with a high level of earnings visibility and stability, offering
investors a compelling way to access the alternative asset
management industry.” Lipschultz added: “By building on this strong
foundation, we believe we are well positioned to continue to expand
our current platforms and pursue new, complementary business lines
to provide differentiated sources of returns for our
investors.”
George Walker, Chairman and Chief Executive Officer of Neuberger
Berman, added: “This partnership is a clear and natural fit.
Neuberger Berman, as a meaningful shareholder, looks forward to
seeing Blue Owl continue to grow as an industry leader. Moreover,
Neuberger Berman has the privilege of continuing to manage $80
billion in alternatives distinct from the Dyal business, and our
culture of innovation from which Dyal began will continue to help
us deliver for clients in the years to come.”
Upon completion of the transaction, Blue Owl will be a
stand-alone firm and Owl Rock and Dyal founders, alongside
Neuberger Berman, will own meaningful equity positions in Blue
Owl.
Blue Owl is expected to combine these strengths:
Owl Rock Direct Lending Highlights:
- Scaled direct lending business with $23.7 billion in assets
under management as of September 30, 2020
- Focused on lending to middle- and upper-middle-market, private
equity-sponsored companies
- Technology lending strategy capitalizing on the large and
growing demand for technology products and services
- Led by an investment team dedicated to direct lending
- Demonstrated ability to source proprietary investment
opportunities with $24 billion in originations since inception
- Industry-leading credit performance historically and throughout
the COVID-19 pandemic
Dyal GP Capital Solutions Platform Highlights:
- Industry leading GP capital solutions business with a proven
track record, having completed 57 transactions with 49 GPs to
date
- Deep and extensive relationships across the alternative asset
management ecosystem
- Large permanent capital base totaling $23.3 billion in assets
under management (as of November 30, 2020) promotes the formation
of strong, value-added partnerships
- Unique Business Services Platform assists GPs in the portfolio
with a leading set of strategic and capital raising advisory
services
- Led by founder Michael Rees and a senior management team that
has an average of 18 years of experience and more than a decade of
working together in the GP Capital Solutions business
Blue Owl management believes it will have a uniquely attractive
financial profile due to its combination of strong growth and
margins with a focus on permanent capital and fee related earnings
(“FRE”). Specifically, the firm will have over $45.0 billion in
combined assets under management, 92% of which would be permanent
capital, and initially will derive its distributable earnings from
FRE, which allows for enhanced predictability of earnings. Blue Owl
will be well positioned to grow its asset base and distributable
earnings due to the complementary client relationships and
skillsets of Dyal and Owl Rock, which we believe will further
enable new product expansion.
We believe investors in Blue Owl sponsored funds will benefit
from a strategic combination without disruption to the service they
receive or the investment programs they rely upon. Investment
strategies, processes and teams for the company’s funds will remain
consistent, while expecting that their investors will gain from the
combined company’s expanded platform, broadened and deepened
relationships across the alternative asset management landscape,
and a broader range of expertise across the firm.
Owl Rock Capital Corporation (“ORCC”), Owl Rock Capital
Corporation II, Owl Rock Capital Corporation III, Owl Rock
Technology Finance Corp. and Owl Rock Core Income Corp. (the “Owl
Rock BDCs”) will continue to be led by their Chief Executive
Officer and Owl Rock co-founder, Craig Packer, and will not
undertake any change to their investment strategies, team or
process from this transaction. This includes ORCC, which is
publicly traded under the “ORCC” ticker.
The closing of the transaction will result in a change of
control of the registered investment adviser (the “Owl Rock
Advisers”) to each of the Owl Rock BDCs under the Investment
Company Act of 1940, as amended (“1940 Act”), and will require the
assignment of each Owl Rock BDC’s current investment advisory
agreement in accordance with the 1940 Act. As a result, each BDC’s
shareholders will be asked to approve an amended and restated
investment advisory agreement between such Owl Rock BDC and the
applicable Owl Rock Adviser, which will replace its current
investment advisory agreement upon the consummation of the
transaction. All material terms will remain unchanged from the Owl
Rock BDCs’ current investment advisory agreements, and such
agreements, if approved by the applicable Owl Rock BDCs’
shareholders, will become effective upon the closing of the
transaction.
Transaction Overview
Pursuant to the transaction, Altimar, which currently holds $275
million in cash in trust, will combine with Blue Owl at an
estimated $12.5 billion pro forma equity value at closing. Assuming
no redemptions by Altimar’s existing public stockholders, the
existing equityholders of Owl Rock and Dyal (including Neuberger
Berman) will hold approximately 85% of Blue Owl immediately
following the closing of the business combination. The founders and
senior managers of Blue Owl will retain their equity stakes
immediately following the transaction, promoting continued
alignment with the combined company’s public investors and
clients.
Cash proceeds in connection with the transaction will be funded
through a combination of Altimar’s cash in trust and a $1.5 billion
fully committed, oversubscribed, common stock private investment in
public equity (“PIPE”) at $10.00 per share, including commitments
from leading investors including ICONIQ Capital, CH Investment
Partners, Koch Companies Defined Benefit Master Trust, the
Federated Hermes Kaufmann Funds, and Liberty Mutual
Investments.
The board of directors for each of Altimar and Neuberger Berman,
as well as the Executive Committee of Owl Rock, have unanimously
approved the proposed transaction. Completion of the proposed
transaction is subject to approvals of Altimar’s stockholders, the
equityholders of each of the Owl Rock BDCs to the assignment of its
advisory agreement, as discussed above, and Dyal-sponsored fund's
limited partners, in addition to other customary closing
conditions, including a registration statement being declared
effective by the Securities and Exchange Commission. The
transaction is expected to be completed in the first half of
2021.
Management and Board of Directors
Upon completion of the strategic combination, Blue Owl will be
led by Doug Ostrover (Owl Rock co-founder) as Chief Executive
Officer. The senior management team will also include Michael Rees
(founder of Dyal) and Marc Lipschultz (Owl Rock co-founder) as
co-Presidents and Alan Kirshenbaum as Chief Financial Officer.
Craig Packer (Owl Rock co-founder) will continue as Chief Executive
Officer of the Owl Rock BDCs.
Blue Owl’s nine-person board of directors will be initially
composed of three independent directors, three Owl Rock-appointed
directors, two Dyal-appointed directors and one Neuberger
Berman-appointed director.
Advisors
Perella Weinberg Partners LP, Goldman Sachs & Co. LLC and
BofA Securities, Inc. are serving as financial advisors and
Kirkland & Ellis LLP is serving as legal counsel to Owl
Rock.
Ardea Partners LP is serving as financial advisor for Neuberger
Berman and Dyal. Skadden, Arps, Slate, Meagher & Flom LLP is
serving as legal counsel to Neuberger Berman. Additionally,
Citigroup and UBS are serving as advisors to Neuberger Berman.
Evercore Group LLC is serving as financial advisor and Fried,
Frank, Harris, Shriver & Jacobson LLP is serving as legal
counsel to Dyal.
J.P. Morgan Securities LLC is serving as exclusive financial
advisor and Paul, Weiss, Rifkind, Wharton & Garrison LLP is
serving as legal counsel to Altimar Acquisition Corporation.
Goldman Sachs & Co. LLC and J.P. Morgan Securities LLC acted
as joint placement agents on the PIPE.
Investor Conference Call Information
An investor call and presentation discussing the transaction is
available at the link below:
https://dpregister.com/sreg/10150767/dfccfb54ba Participant Dial
In (Toll Free): 1-866-777-2509 Participant International Dial In:
1-412-317-5413
Replay Dial In:
US (Toll Free): 1-877-344-7529 International Toll:
1-412-317-0088 Replay Access Code: 10150767
A transcript of the call will also be filed by Altimar with the
SEC.
On the call, the presenters will be reviewing an investor
presentation, which will be filed with the SEC as an exhibit to a
Current Report on Form 8-K prior to the call, and available on the
SEC website at www.sec.gov.
About Altimar Acquisition Corporation
Altimar Acquisition Corporation is a special purpose acquisition
company sponsored by Altimar Sponsor, LLC, an affiliate of HPS
Investment Partners, LLC, formed for the purpose of effecting a
merger, share exchange, asset acquisition, share purchase,
reorganization or similar business combination with one or more
businesses. For more information, visit www.altimarspac.com.
About Owl Rock
Owl Rock Capital Group, together with its subsidiaries, is a New
York-based direct lending platform with approximately $23.7 billion
of assets under management as of September 30, 2020. Owl Rock’s
platform consists of multiple investment funds and products
including business development companies (“BDCs”). Owl Rock is
comprised of a team of seasoned investment professionals with
significant and diverse experience from some of the world’s leading
investment firms and financial institutions. Owl Rock’s
relationship-oriented approach to investing seeks to provide
companies with sizeable commitments to facilitate transactions and
support their growth needs with certainty, speed and transparency
throughout the entire investment process.
About Dyal Capital
Dyal Capital seeks to acquire minority equity stakes in and
provide financing to established alternative asset managers. With
over a decade of experience transacting with institutional
financial firms, Dyal has completed over 50 equity and debt
transactions and manages approximately $23.3 billion in aggregate
capital commitments as of November 30, 2020. Central to Dyal’s
success is our Business Services Platform (the “BSP”). The BSP is a
team that provides strategic support to underlying management
company partners in various areas, primarily including capital
strategy and advisory services. Part of Neuberger Berman, the Dyal
team is located in New York, London, and Hong Kong.
About Neuberger Berman
Neuberger Berman Group LLC, founded in 1939, is a private,
independent, employee-owned investment manager. The firm manages a
range of strategies—including equity, fixed income, quantitative
and multi-asset class, private equity, real estate and hedge
funds—on behalf of institutions, advisors and individual investors
globally. With offices in 24 countries, Neuberger Berman’s diverse
team has over 2,300 professionals. For six consecutive years, the
company has been named first or second in Pensions &
Investments Best Places to Work in Money Management survey (among
those with 1,000 employees or more). In 2020, the PRI named
Neuberger Berman a Leader, a designation awarded to fewer than 1%
of investment firms for excellence in Environmental, Social and
Governance (ESG) practices. The PRI also awarded Neuberger Berman
an A+ in every eligible category for its approach to ESG
integration across asset classes. The firm manages $374 billion in
client assets as of September 30, 2020, including $103 billion in
alternative assets.
Important Additional Information and Where to Find It
This communication is being made in respect of the proposed
business combination transaction involving Altimar and Blue Owl.
Altimar intends to file a registration statement on Form S-4 with
the Securities and Exchange Commission (the “SEC”), which will
include a proxy statement and a prospectus of Altimar, and each
party will file other documents with the SEC regarding the proposed
transaction. A definitive proxy statement/prospectus will also be
sent to the stockholders of Altimar, seeking any required
stockholder approval. Before making any voting or investment
decision, investors and security holders of Altimar are urged to
carefully read the entire registration statement and proxy
statement/prospectus, when they become available, and any other
relevant documents filed with the SEC, as well as any amendments or
supplements to these documents, because they will contain important
information about the proposed transaction. The documents filed
by Altimar with the SEC may be obtained free of charge at the SEC’s
website at www.sec.gov. In addition, the documents filed by Altimar
may be obtained free of charge from Altimar at www.altimarspac.com.
Alternatively, these documents, when available, can be obtained
free of charge from Altimar upon written request to Altimar
Acquisition Corp., 40 West 57th Street, New York, New York 10019,
Attn: Secretary, or by calling 212-287-6767.
In connection with the proposed transaction which will result in
the change in control of the Owl Rock Advisers, the applicable Owl
Rock BDCs intend to file proxy statements in preliminary and
definitive form with the Securities and Exchange Commission (the
“SEC”) that will contain important information about the proposed
transaction and related matters, and deliver a copy of the proxy
statement to its shareholders. Investors of the Owl Rock BDCs are
urged to read the definitive proxy statement and other relevant
documents carefully and in their entirety when they become
available because they will contain important information about the
proposed transaction and related matters. Investors may obtain a
free copy of these materials when they are available, and other
documents filed by the Owl Rock BDCs, with the SEC at the SEC’s
website at www.sec.gov or at Owl Rock’s website at www.owlrock.com
or www.owlrock.com/proxy/ or, for Owl Rock Capital Corporation, at
www.owlrockcapitalcorporation.com. Investors and security holders
may also obtain free copies of the proxy statement and other
documents filed with the SEC from the Owl Rock BDCs by contacting
Investor Relations at (212) 651-4705.
Participants in the Solicitation
Altimar and certain of its respective directors and executive
officers may be deemed to be participants in the solicitation of
proxies from the stockholders of Altimar, in favor of the approval
of the business combination. For information regarding Altimar’s
directors and executive officers, please see Altimar’s final
prospectus related to its initial public offering filed with the
SEC on October 23, 2020. Additional information regarding the
interests of those participants and other persons who may be deemed
participants in the transaction may be obtained by reading the
registration statement and the proxy statement/prospectus and other
relevant documents filed with the SEC when they become available.
Free copies of these documents may be obtained as described in the
preceding section
The applicable Owl Rock BDCs and their directors, executive
officers, employees and other persons certain of their respective
directors and executive officers may be deemed to be participants
in the solicitation of proxies from the stockholders or
shareholders of the applicable Owl Rock BDCs’ common stock in
respect of the change in control Transaction. For information
regarding the Owl Rock BDCs’ directors and executive officers,
please see: Owl Rock Capital Corporation’s definitive proxy
statement filed with the SEC on April 17, 2020, in connection with
its 2020 annual meeting of shareholders; Owl Rock Capital
Corporation II’s definitive proxy statement filed with the SEC on
April 17, 2020, in connection with its 2020 annual meeting of
shareholders; Owl Rock Technology Finance Corp.’s definitive proxy
statement filed with the SEC on April 17, 2020, in connection with
its 2020 annual meeting of shareholders; and Owl Rock Capital
Corporation III’s registration statement on Form 10 filed with the
SEC on July 17, 2020. Other information regarding persons who may
be deemed participants in the proxy solicitation and a description
of their direct and indirect interests, by security holdings or
otherwise, will be contained in the proxy statement and other
relevant materials to be filed with the SEC when they become
available.
This communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval, nor shall there be any sale of any securities
in any state or jurisdiction in which such offer, solicitation, or
sale would be unlawful prior to registration or qualification under
the securities laws of such other jurisdiction.
Forward-Looking Statements
Certain statements made in this press release, and oral
statements made from time to time by representatives of Owl Rock,
Dyal and Neuberger Berman are “forward-looking statements” within
the meaning of the safe harbor provisions of the United States
Private Securities Litigation Reform Act of 1995. Statements
regarding the potential combination and expectations regarding the
combined business are forward-looking statements. In addition,
words such as “estimates,” “projects,” “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. 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 the control of the parties, that
could cause actual results or outcomes to differ materially from
those discussed in the forward-looking statements.
In addition to factors previously disclosed in Altimar’s reports
filed with the SEC, including its registration statement on Form
S-1 filed in connection with its initial public offering, and those
identified elsewhere in this communication, important factors that
could cause actual results and outcomes to differ materially from
those indicated in the forward-looking statements include, among
others, the following: (i) the inability of the parties to enter
into a definitive agreement with respect to the potential
combination or to complete the contemplated transactions; (ii)
matters discovered by any of the parties as they complete their
respective due diligence investigation of the other parties; (iii)
the risk that requisite regulatory, corporate and other approvals
and consents for the potential transaction are not obtained or are
delayed; (iv) the inability to recognize the anticipated benefits
of the proposed combination; (v) delays in signing or closing a
transaction; (vi) difficulties, delays or unanticipated costs in
integrating the operations or personnel of Owl Rock and Dyal; (vii)
unexpected costs resulting from the transaction; (viii) changes in
general economic conditions, including as a result of the COVID-19
pandemic and (ix) regulatory conditions and developments.
Forward-looking statements speak only as of the date they are made,
and none of Owl Rock, Dyal or Neuberger Berman undertakes any
obligation, and expressly disclaims any obligation, to update,
alter or otherwise revise any forward-looking statements, whether
as a result of new information, future events or otherwise, except
as required by law. Readers should carefully review the statements
set forth in the reports, which Altimar has filed or will file from
time to time with the SEC.
Non-GAAP Financial Measures
This press release includes references to fee related earnings,
or FRE, which is a supplemental measure that is not required by, or
prepared in accordance with, accounting principles generally
accepted in the United States (“GAAP”).
FRE is used to assess core operating performance by determining
whether recurring revenue is sufficient to cover operating expenses
and to generate profits. FRE is derived from and reconciled to, but
not equivalent to, its most directly comparable GAAP measure of Net
Income (Loss) Before Income Taxes. FRE differs from income before
taxes computed in accordance with GAAP as it excludes performance
income, performance related compensation, investment net gains
(losses) and certain other items that we believe are not indicative
of our core operating performance. We use FRE as a non-GAAP measure
to assess and track our performance. FRE is not a measurement of
our financial performance under GAAP and should be considered in
addition to, and not in lieu of, the results of operations which
are derived in accordance with GAAP.
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version on businesswire.com: https://www.businesswire.com/news/home/20201223005263/en/
Altimar Contact
Prosek Partners Mike Geller mgeller@prosek.com
Owl Rock and Dyal Contacts
Prosek Partners David Wells / Andy Merrill / Josh Clarkson /
Emily Goldberg dwells@prosek.com / amerrill@prosek.com /
jclarkson@prosek.com / egoldberg@prosek.com
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