Blue Owl Joins Bond Rush With $1 Billion Note to Repay Debt

(Bloomberg) -- A Blue Owl Capital Inc. fund is selling $1 billion of debt in the US high-grade bond market on Tuesday, adding to the flood of new issuance seen over the last few days. 

Blue Owl Credit Income Corp., one of the funds under the private markets-focused alternative asset manager, is selling the long five-year note, according to a person familiar with the matter. The note will yield 2.6 percentage points over Treasuries after initial price talk in the 2.8 percentage points area, the person said, asking not to be identified as the details are private. 

Blue Owl plans to use the sale proceeds to help pay down debt under its revolving credit facility, asset-backed security and other secured financings, the person said.

A spokesperson for Blue Owl did not reply to a request for comment.

The offering follows a deal from another private credit lender earlier this week, namely Sixth Street Lending Partners, which sold $600 million of debt on Monday. Private credit funds, also known as business development companies, have been issuing debt at a record-setting pace this year.

Since last week, companies have been swarming the US blue-chip bond market with fresh financings in a rush to take advantage of falling bond yields. About $87 billion of new deals have already been sold so far this month. 

Nine other issuers are looking to sell debt on Tuesday, including Oneok Inc., which is selling bonds to fund the purchase price for its EnLink Midstream LLC and Medallion Midstream transactions.

Mitsubishi UFJ Financial Group Inc., Royal Bank of Canada, Sumitomo Mitsui Banking Corp. and Wells Fargo & Co. are leading Blue Owl’s debt sale, the person familiar said. 

(Updates to specify Blue Owl Credit Income Corp. is the issuer, adds pricing details in first and second paragraphs, updates company comment in fourth paragraph.)

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