US EditionBlue Owl limits withdrawals in two funds after historic surge in redemption requests
Blue Owl said AI-related worries drove 40.7% redemption requests at its tech fund and 21.9% at its flagship fund, but payouts were capped at 5%.
- On Thursday, Blue Owl Capital announced it will limit quarterly redemptions to 5% for two of its private credit funds, following a historic surge in investor withdrawal requests during the first quarter.
- Blue Owl attributed the elevated exit requests to "heightened market concerns around AI-related disruption to software companies," claiming a "meaningful disconnect" between public sentiment and its portfolio performance.
- Investors requested withdrawals for 40.7% of shares in Blue Owl Technology Income Corp and 21.9% of shares in the larger Blue Owl Credit Income Corp during the quarter.
- Shares of Blue Owl fell roughly 9% in premarket trading Thursday, marking a reversal from the firm's prior practice of honoring redemption requests above the 5% threshold.
- CEO Craig Packer said the elevated tender activity reflects a "period of heightened negative sentiment toward the asset class" intensifying as peers report similar results across the non-traded BDC industry.
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Redemptions represent 22% of Blue Owl Capital's massive $36 billion private credit fund and 41% of a separate technology-focused fund.
A wave of return requests is recorded by the financial institution. High withdrawal requirements for two of its funds illustrate the tense situation on the market – and force Blue Owl to act.
Blue Owl faces withdrawal flood as private credit jitters persist
Investors rushed out of Blue Owl’s flagship and technology-focused credit funds as jitters continue to sharpen in private credit.Blue Owl’s largest fund, a $36 billion pot of corporate loans known by its ticker, OCIC, received redemption requests for 22% of its assets, the firm said today. A smaller, $6 billion fund loaded with software loans — an unsettled corner of the investment world as AI disruption looms — saw 41% withdrawal requests. Blue…
Blue Owl’s $36 Billion Private-Credit Fund Hit by 22% Withdrawal Request
Investors in Blue Owl Capital’s $36 billion private-credit fund asked to withdraw 22% of their money, while a separate technology-focused fund received redemption requests for 41%, adding to the growing stream of capital leaving the once-hot corner of Wall Street.
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