Blue Owl Capital's private credit vehicle, Blue Owl Credit Income Corp (OCIC), has raised $500 million by selling investment-grade bonds, a person familiar with the transaction told Bloomberg News. The issuance comes amid a period of elevated redemption activity for private credit funds, and follows earlier limits Blue Owl placed on investor withdrawals.
According to the report, OCIC priced five-year notes with a spread of 255 basis points over U.S. Treasuries and at a reoffer price of 98.771. The offering saw the spread tighten by roughly 25 basis points from the initial price guidance, the report added. The net proceeds from the sale will be applied to repay outstanding debt on the company's balance sheet.
OCIC is organized as a business development company - a type of investment vehicle that raises equity and combines it with leverage to finance loans, primarily to mid-sized companies. This structure allows the firm to pair investor capital with borrowed funds to originate and hold credit exposures.
The bond sale arrives against a backdrop of investor caution toward private credit. Wealthy investors have sought to redeem holdings from private credit vehicles in recent months, a trend the report linked to concerns about weakening lending standards and worries that advances in artificial intelligence could disrupt the software sector, an area where many private credit strategies hold exposure.
Earlier in the year, Blue Owl capped withdrawals at 5% of shares at two of its funds after receiving an unusually high volume of redemption requests in the first quarter. Those limits were imposed to manage liquidity and meet redemption demands within the funds' operational constraints.
Blue Owl did not immediately provide a response to a request for comment, according to the report.
Transaction details
- Issuer: Blue Owl Credit Income Corp (OCIC)
- Size: $500 million
- Tenor: Five-year notes
- Pricing: 255 basis points over U.S. Treasuries, reoffer price 98.771
- Spread movement: About 25 basis points tighter than initial price talk
- Use of proceeds: Repayment of debt
This financing action and the firm's earlier withdrawal caps together underscore liquidity management steps taken by a private credit manager during a period of elevated investor outflows and sector-specific concerns.