Blue Owl Capital Significantly Expands Alternative Credit and Asset-Based Finance Capabilities with Acquisition of Atalaya Capital Management's Business
Blue Owl Capital Inc. (NYSE: OWL) has announced a $450 million acquisition of Atalaya Capital Management LP, an alternative credit manager. The deal, expected to close in H2 2024, will add over $10 billion in assets under management to Blue Owl's portfolio. Atalaya, founded in 2006, specializes in asset-based credit investments across various sectors.
The acquisition price includes $350 million in Blue Owl equity and $100 million in cash, with a potential $350 million earnout based on future revenue targets. Ivan Zinn, Atalaya's founder, will join Blue Owl as Head of Alternative Credit. The move is expected to be modestly accretive to Blue Owl in 2025 and will significantly expand its alternative credit offerings.
- Acquisition adds over $10 billion in assets under management to Blue Owl
- Expands Blue Owl's alternative credit capabilities and offerings
- Expected to be modestly accretive to Blue Owl in 2025
- Atalaya has deployed over $17 billion of capital since inception
- 70% of Atalaya's deal flow sourced directly through asset owners, originators or joint venture partners
- Significant upfront cost of $450 million for the acquisition
- Potential for up to $350 million additional earnout, increasing total acquisition cost
- Integration challenges may arise from merging two distinct organizations
Blue Owl Capital's acquisition of Atalaya Capital Management signals a significant strategic move. Acquiring an established business within the alternative credit and asset-based finance sector expands Blue Owl's offerings. The
Importantly, the earnout consideration of up to
From a valuation perspective, this acquisition adds value by expanding Blue Owl’s business lines, which could lead to a re-rating of its shares in the long term, especially if Atalaya's performance remains robust.
This acquisition not only broadens Blue Owl’s product offerings in the alternative credit space but also integrates Atalaya’s strong market presence and expertise. Atalaya’s direct sourcing strategy has historically provided a significant competitive edge, directly sourcing nearly 70% of its deal flow. This expertise complements Blue Owl's existing direct lending capabilities, potentially leading to higher yields and diversified revenue streams.
From a market perspective, the move could be seen as a strategic diversification effort, mitigating risk by expanding into asset-based finance. Additionally, Atalaya’s reputable track record through different market cycles adds a layer of operational stability. Investors should consider the strategic value of this acquisition in reinforcing Blue Owl’s market position and enhancing its product suite. Short-term fluctuations aside, the potential for long-term revenue growth and market share expansion appears substantial.
- Established alternative credit management business with an 18-year track record will add over
in assets under management.$10 billion
Atalaya focuses primarily on asset-based credit investments across consumer and commercial finance, corporate and real estate assets, and managed over
The closing purchase price of
Blue Owl's Co-CEOs Doug Ostrover and Marc Lipschultz said: "The acquisition of Atalaya adds adjacent and scaled alternative credit capabilities that complement Blue Owl's leading position in direct lending. Atalaya was an early pioneer in private asset-based finance. They have created a robust business with highly differentiated sourcing and underwriting expertise and have demonstrated a strong track record across market cycles. Atalaya significantly expands Blue Owl's alternative credit offerings and delivers a more robust suite of financing solutions to our stakeholders."
Ivan Zinn said, "We view Blue Owl as an ideal strategic partner to support the next stage of our growth. We are proud of the exceptional track record we built over nearly two decades and are incredibly grateful to our investors, team and partners who made this journey possible. We look forward to continuing to drive forward at the leading edge of alternative credit as part of Blue Owl."
Citigroup, MUFG Bank, Ltd., SMBC and Wells Fargo are acting as co-financial advisors to Blue Owl in connection with the acquisition. Kirkland & Ellis LLP is acting as legal advisor to Blue Owl.
Mizuho, RBC and Truist are acting as co-advisors to Atalaya. Cravath, Swaine & Moore LLP is acting as legal advisor to Atalaya.
A supplemental investor presentation with respect to the acquisition is available on the shareholders section of Blue Owl's website at www.blueowl.com.
About Blue Owl
Blue Owl (NYSE: OWL) is a leading asset manager that is redefining alternatives.
With over
Together with over 725 experienced professionals globally, Blue Owl brings the vision and discipline to create the exceptional. To learn more, visit www.blueowl.com.
About Atalaya Capital Management
Atalaya Capital Management is a privately held, SEC-registered, alternative asset manager who primarily focuses on making private credit and special situation investments in three principal asset classes – specialty finance, real estate and corporate. Founded in 2006, Atalaya is headquartered in
Forward Looking Statements
Certain statements made in this release are "forward looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words "estimates," "projected," "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. Any such forward-looking statements are made pursuant to the safe harbor provisions available under applicable securities laws and speak only as of the date made. Blue Owl assumes no obligation to update or revise any such forward-looking statements except as required by law.
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 Blue Owl's control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements.
Important factors, among others, that may affect actual results or outcomes include the inability to recognize the anticipated benefits of strategic acquisitions; costs related to acquisitions; the inability to maintain the listing of Blue Owl's shares on the New York Stock Exchange; Blue Owl's ability to manage growth; Blue Owl's ability to execute its business plan and meet its projections; potential litigation involving Blue Owl; changes in applicable laws or regulations; and the possibility that Blue Owl may be adversely affected by other economic, business, geo-political and competitive factors.
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SOURCE Blue Owl Capital
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