THE GOLDMAN SACHS GROUP, INC. By Cara Lombardo and Miriam Gottfried
Owl Rock Capital Partners LP and Dyal Capital Partners agreed to merge in a complicated deal that would take them public through a blank-check company.
The new company, to be named Blue Owl, would combine one of the biggest owners of private-equity firm stakes with Owl Rock, a rapidly growing credit investor. It would be valued at about $12.5 billion.
The Wall Street Journal reported earlier this month that the firms were discussing such a deal.
The firms plan to go public through a merger with Altimar Acquisition Corp., a special-purpose acquisition company sponsored by an affiliate 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 exploded in popularity recently as an alternative to traditional initial public offerings. This deal, assuming shareholders approve it, would be one of the largest such transactions. It is the second-largest SPAC transaction announced in the U.S. this year, eclipsed only by a deal to take mortgage originator United Wholesale Mortgage public at a valuation of roughly $16 billion.
The deal is also one of a few instances of two companies merging with each other and a SPAC simultaneously. Sports-betting operator DraftKings Inc. merged with a gambling-technology provider as part of a deal that took 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. It already owns stakes in both Owl Rock and HPS.
For its entire existence, Dyal has been a unit of Neuberger Berman Group LLC, the big, privately held investment firm. Neuberger would retain a stake in Blue Owl and hold a board seat.
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 former Goldman Sachs Group Inc. banker Craig Packer. It has shot 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 nonbanks make loans to midsize companies, many of them backed by private equity, and hold them on their books. Such lenders have been on the rise since the aftermath of the 2008-09 financial crisis, when banks shed many of their riskier businesses.
Perella Weinberg Partners LP, Goldman Sachs & Co. LLC and BofA Securities Inc. are financial advisers to Owl Rock. Ardea Partners LP is financial adviser to Neuberger Berman and Dyal; Evercore Group LLC is financial adviser to Dyal; and J.P. Morgan Securities LLC is financial adviser to Altimar. Citigroup and UBS are also advising Neuberger Berman.
Write to Cara Lombardo at cara.lombardo@wsj.com and Miriam Gottfried at Miriam.Gottfried@wsj.com
(END) Dow Jones Newswires
12-23-20 0938ET
