Owl Rock Capital Partners LP and Dyal Capital Partners agreed to merge into a complicated deal that would make them public through a blank check company.
The new company, to be called Blue Owl, would combine one of the largest owners of stakes in private equity firms 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 the deal.
The companies plan to go public through a merger with Altimar Acquisition Corp.
ATTACK 3.27%
, a special purpose acquisition company sponsored by a subsidiary of HPS Investment Partners LLC. The deal also includes additional funds of 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 agreement, assuming shareholders approve it, would be one of the most important transactions of its kind. This is the second largest SPAC transaction announced in the United States this year, only overshadowed by an agreement to make the United Wholesale Mortgage on sale at a valuation of approximately $ 16 billion.
The agreement is also one of the few cases of a merger of two companies with each other and a SPAC simultaneously. DraftKings sports betting operator Inc.
it merged with a gaming technology provider as part of an agreement 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 shops and hedge funds. He already has stakes in Owl Rock and HPS.
Throughout its existence, Dyal has been a unit of Neuberger Berman Group LLC, the large private investment firm. Neuberger would hold a stake in Blue Owl and occupy a seat on the board.
Owl Rock was founded in 2016 by Mr. Ostrover, who was a co-founder of GSO Capital Partners and later sold it to Blackstone Group; the former partner of KKR & Co. Marc Lipschultz; and the former Goldman Sachs Group Inc.
GS -0.43%
banker Craig Packer. It has accumulated up to $ 23.7 billion in assets, managed primarily through business development companies.
The firm focuses on a fast-growing area known as direct lending, in which non-banks lend to medium-sized companies, many of them backed by private equity, and keep them in their books. These lenders have been on the rise since the aftermath of the 2008-09 financial crisis, when banks abandoned many of their riskiest businesses.
Perella Weinberg Partners LP, Goldman Sachs & Co. LLC and BofA Securities Inc. they are financial advisors to Owl Rock. Ardea Partners LP is financial advisor to Neuberger Berman and Dyal; Evercore Group LLC is a financial advisor to Dyal; and JP Morgan Securities LLC is Altimar’s financial advisor. Citigroup and UBS also advise Neuberger Berman.
Write to Cara Lombardo to [email protected] and Miriam Gottfried to [email protected]
Copyright © 2020 Dow Jones & Company, Inc. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8
It appeared in the December 24, 2020 print edition as “Investors Will Combine, It Will Be Made Public as a $ 12.5 Billion Company.”