Latest news with #BlueOwlCapital
Mint
19 hours ago
- Business
- Mint
Lure of ‘Free Money' in Secondaries Nears a Mania
(Bloomberg) -- Demand for secondary funds focused on private markets is soaring, in part because some investors are seizing on an accounting quirk that allows them to buy assets at a discount and then revalue them at par. It's 'creating this sense that people are just picking up free money, and almost a mania,' Blue Owl Capital Co-Chief Executive Officer Marc Lipschultz said on a call with analysts recently. He said his firm avoids the practice, adding there is still a 'great business to be had being a really thoughtful buyer of secondary interest when you have more sellers today than you've ever had in the past.' The secondary market allows investors to buy or sell stakes in private-asset funds, often at a discount. It's become an increasingly popular solution to the problem that many managers faced at the end of the easy-money era, when higher interest rates made some valuations more difficult to justify — and left them unable to exit investments. Credit is expected to be the fastest-growing part of secondaries for years to come, according to Jefferies Financial Group Inc., which forecasts the number of transactions in the space to grow to more than $17 billion this year from $10 billion last year. The marketplace for fund stakes is drawing more sellers than ever before, pushing up prices, which is tempting more investors to look at disposals. Investors in private credit funds looking for liquidity are now able to shift their positions into the secondary market, clearing a bottleneck in the financing chain. The deadlock started when dealmaking stalled, forcing private company owners to hold on to assets for longer. That meant direct lenders had to extend loans for longer too and wait to cash out, crimping returns for some. One benefit for some buyers is the accounting treatment which allows them to mark up the acquisitions, bolstering the value of the assets. 'It's true that secondary transactions are often completed at a discount to NAV, and yes, that can create an initial unrealized gain for the buyer,' private capital investor Hamilton Lane wrote on its website last month. 'But this isn't artificial. It represents real value and can enhance returns for the fund.' More broadly, the wider secondaries trend has proven fruitful recently. The strategy was the best performing for Blackstone Inc. in the second quarter, the alternative asset manager said in a presentation last month. The firm is considering a standalone pool of capital to buy second-hand private credit funds through its Strategic Partners unit, Bloomberg News reported last month. London-based Coller Capital Ltd. closed a deal for a $3 billion continuation fund with direct lender TPG Twin Brook Capital Partners this past week that will transfer a portfolio of loans from the US firm's previous vintages into a new fund. It's the largest such vehicle in private credit secondaries to date. Other signs of appetite for the strategy include Pantheon, a manager of more than $70 billion, raising three times its original target of $750 million for its third credit secondaries fund. Ares Management Corp., meanwhile, has so far raised more than $3.5 billion for its debut credit secondaries fund and related vehicles, Chief Executive Officer Michael Arougheti said on an earnings call last month. The secondaries group 'remains one of our strongest growth vectors for the foreseeable future,' he said. More stories like this are available on
Bloomberg
19 hours ago
- Business
- Bloomberg
Lure of ‘Free Money' in Secondaries Nears a Mania
Demand for secondary funds focused on private markets is soaring, in part because some investors are seizing on an accounting quirk that allows them to buy assets at a discount and then revalue them at par. It's 'creating this sense that people are just picking up free money, and almost a mania,' Blue Owl Capital Co-Chief Executive Officer Marc Lipschultz said on a call with analysts recently. He said his firm avoids the practice, adding there is still a 'great business to be had being a really thoughtful buyer of secondary interest when you have more sellers today than you've ever had in the past.'
Bloomberg
3 days ago
- Business
- Bloomberg
Private Credit Funds Are Finding Fewer Deals to Deploy Capital
Private credit executives have long said a deal comeback is right around the corner. That hope for a turnaround was quashed in the second quarter as US tariffs and a prolonged deal drought stymied how much capital a key part of the industry put to work. Blue Owl Capital Corp. deployed $1.1 billion to new deals in the quarter, a roughly 67% drop compared to a year prior, according to regulatory filings for the business development company. Blackstone Secured Lending Fund deployed 51% less in the second quarter compared to last year. Ares Capital Corp. 's origination volumes dropped 33% year-over-year.
Reuters
4 days ago
- Business
- Reuters
Reports: Blazers find buyer, staying in Portland
August 13 - By Field Level Media Carolina Hurricanes owner Tom Dundon has reached a tentative agreement to purchase the Portland Trail Blazers from the estate of Paul Allen for more than $4 billion, ESPN reported on Wednesday. Sportico, which first reported the agreement, said that Dundon plans to keep the NBA team in Portland. Blue Owl Capital co-president Marc Zahr and Sheel Tyle, co-CEO of Collective Global, are also involved in Dundon's group, per reports. Dundon bought the NHL's Hurricanes in 2018 for $425 million and also is majority owner of the PPA Tour and Major League Pickleball. The estate announced that the Trail Blazers were for sale in May. The NBA's Board of Governors would have to ratify any purchase agreement. Allen, the billionaire co-founder of Microsoft, purchased the Trail Blazers for $70 million in 1988. He died in 2018, with his will directing his estate to sell the sports assets. Allen's estate also owns the NFL's Seattle Seahawks and a 25 percent stake in the Seattle Sounders of MLS. The Trail Blazers are one of the lowest-valued teams in the league at $3.65 billion, according to CNBC's 2025 team valuations.
Geek Wire
4 days ago
- Business
- Geek Wire
Paul Allen estate to sell Portland Trail Blazers to group led by Carolina NHL team owner
Fans pack the Moda Center in Portland during a Trail Blazers home game. (GeekWire File Photo / Taylor Soper) The owner of the Carolina Hurricanes NHL team reached an agreement to buy the Portland Trail Blazers NBA team from the estate of the late Microsoft co-founder Paul Allen. Dallas-based billionaire Tom Dundon declined to give specific details of the deal on Wednesday, according to CNBC. ESPN's Shams Charania reported that the price tag was over $4 billion. The Oregonian reported that Dundon heads a group of investors that includes the co-president of Blue Owl Capital, Marc Zahr, as well as Portland-based Sheel Tyle, co-CEO of Collective Global. A source said the group 'is passionate about basketball and intends to keep the team in Portland, where it belongs.' Any deal will require NBA approval. The Allen estate announced in May that it was seeking a buyer, consistent with Allen's wishes that his sports franchises be sold off, with the proceeds going to philanthropy. The sale is part of the long process of divesting many of the assets and investments that Allen made during his lifetime. Allen died in 2018, at the age of 65, after he was diagnosed with a recurrence of non-Hodgkin's lymphoma. Allen's estate, headed by his sister Jody Allen, previously said the Trail Blazers announcement does not impact its ownership of the Seattle Seahawks NFL franchise, or its 25% stake in the Seattle Sounders MLS team, which are not yet for sale. The Trail Blazers started play during the 1970-71 NBA season. Allen bought the team in 1988 for $70 million.
