Owl Rock Capital Group and Neuberger Berman Group's Dyal Capital Partners announced Wednesday that they have agreed to merge.
The two firms will combine with a special purpose acquisition company, Altimar Acquisition Corp., to form a publicly traded alternative investment firm, Blue Owl Capital Inc., according to an SEC filing.
Altimar is sponsored by alternative investment firm HPS Investment Partners.
The deal valued at about $12.2 billion and includes a combined $1.5 billion commitment from ICONIQ Capital, CH Investment Partners, $6.8 billion Koch Companies Defined Benefit Master Trust, Wichita, Kan, the Federated Hermes Kaufmann Funds and Liberty Mutual Investments.
Blue Owl is expected to be listed on the NYSE under the new ticker OWL and have a post-transaction market capitalization of about $12.5 billion.
Blue Owl's management team will include CEO Douglas Ostrover, Owl Rock co-founder and CEO, and Michael Rees, founder and managing directorof Dyal, and Marc Lipschultz, Owl Rock co-founder and president, as co-presidents. Alan Kirshenbaum, Owl Rock and COO and CFO, will be CFO at Blue Owl, and Craig Packer, Owl Rock co-founder, will continue as CEO of the Owl Rock business development companies, which will retain the name.
During an investor call Wednesday, Mr. Kirshenbaum said that Blue Owl management and founders will retain a combined 24% of the company.
As part of the transaction, Neuberger Berman will receive $1.1 billion, representing a partial sale of its interest in Dyal, he said. Neuberger Berman will be a "meaningful shareholder" in Blue Owl, but did not specify its stake in the new company, according to a joint news release.
After the deal closes, Neuberger Berman will continue to manage $80 billion in alternative investments distinct from the Dyal business, the release said. Neuberger Berman executives declined to provide additional information beyond the news release.
Owl Rock has $23.7 billion in assets under management, $19.7 billion of which is permanent capital, Mr. Ostrover said. Dyal, to be known as Dyal GP Capital Solutions, has $23.3 billion in AUM, 100% of which is permanent capital, he said. Dyal acquired a passive, non-voting minority stake in Owl Rock Capital in November 2019.
Mr. Ostrover stressed that about 91% of Blue Owl's assets under management will be permanent capital.
"If you listen to the investor calls of virtually every alternative manager, one of the things they all stress is they want to increase the amount of permanent capital they have," Mr. Ostrover said during the investor call. "And so, we are starting light years ahead of our peers."
Blue Owl will have two major lines of business: Owl Rock's direct lending strategies and Dyal's minority stake equity and private equity manager financing business.
The boards of directors of Altimar and Neuberger Berman as well as the Owl Rocks executive committee have all unanimously approved the transaction. Completion of the deal is subject to approvals of Altimar's stockholders, the equityholders of each of the Owl Rock business development companies and Dyal-sponsored fund's limited partners.
The transaction is expected to close in the first half of 2021.