Catenaa, Thursday, November 27, 2025-Blue Owl Capital is considering reviving a plan to merge its OBDC and OBDC II private credit funds if the share price of the larger fund improves, sources said, following investor backlash that halted the deal last week.
The firm scrapped the merger on November 19 but continues to evaluate options for its funds.
Co-president Craig Packer said the company is not actively pursuing a revival, calling the earlier cancellation final.
Reports also said any future merger would depend on OBDC trading closer to its net asset value and likely occur before OBDC II’s scheduled liquidity event in 2026 or 2027.
The initial plan froze withdrawals from OBDC II and offered holders the larger fund’s price, which rattled investors.
Analysts noted that merging the two funds would reduce costs and provide shareholder exits while aligning overlapping portfolios. Independent IPOs of OBDC II are now considered unlikely.
The private credit sector has expanded rapidly, with non-bank lenders taking market share from traditional Wall Street firms restricted by tighter regulations.
Blue Owl’s funds collectively hold stakes in hundreds of companies valued at $18.8 billion. Analysts said a merger could be the most accretive outcome for shareholders, enhancing earnings and liquidity.
Mergers of publicly-traded and privately-held funds have occurred in the sector, including deals by Carlyle and Goldman Sachs.
Blue Owl executives have said they will continue to assess options, including potential asset sales or listings, amid evolving market conditions.
