Blue Owl Capital Corp III (NYSE:OBDE), a $1.79 billion business development company currently trading at $15.01 and offering an attractive 11% dividend yield, has entered into a Sixth Credit Facility Amendment, a move that paves the way for upcoming mergers, as disclosed in a recent 8-K filing with the U.S. Securities and Exchange Commission.
According to InvestingPro, the company maintains relatively low price volatility, making it an interesting option for stability-focused investors. On Thursday, the company's subsidiary ORCC III Financing LLC, along with various parties including Societe Generale (OTC:SCGLY) as agent, amended the Loan and Servicing Agreement originally dated July 29, 2021.
This amendment allows Blue Owl Capital Corporation to succeed the Predecessor Equityholder as equityholder and collateral manager, marking a significant change in the company's financial structure. Trading at a P/E ratio of 6.17, this transition is contingent upon the completion of the planned mergers outlined in an Agreement and Plan of Merger from August 7, 2024, which will see the Predecessor Equityholder merge into Blue Owl Capital Corporation.
Additionally, the Successor Equityholder will take over as "Seller" and the Successor Collateral Manager will replace the Predecessor Collateral Manager under the Sale and Contribution Agreement from the original closing date. Upon finalization of the mergers, the Successor Equityholder is also set to fulfill the role of "Retention Holder" to meet EU and UK retention requirements.
The specific terms and conditions of the Sixth Credit Facility Amendment are detailed in Exhibit 10.1 of the 8-K filing. This strategic move is expected to streamline the company's operations and financial management post-merger. The information provided in this article is based on the statements from the SEC filing.
In other recent news, Blue Owl Capital Corp III has significantly enhanced its financial flexibility through two major credit agreement amendments. The Maryland-based company first expanded its senior secured revolving credit facility from $600 million to $700 million, with JPMorgan Chase (NYSE:JPM) Bank serving as the administrative agent.
This agreement extends the revolver availability period to November 2028 and the maturity date to November 2029. The company also reduced interest margins and fees, reflecting improved borrowing terms.
In a separate development, Blue Owl Capital Corp III boosted its secured credit facility from $350 million to $500 million through an amendment involving its subsidiary, ORCC III Financing II LLC. This amendment extends the revolving period until December 2, 2027, and sets the facility termination date for December 2, 2029. Additionally, the revised agreement enables the company to draw in Canadian dollars, Euros, and British pounds, broadening its financial operations scope.
State Street (NYSE:STT) Bank and Trust Company has been appointed as the new collateral custodian, replacing Alter Domus (US) LLC, while Deutsche Bank AG (NYSE:DB), New York Branch, continues as the facility agent. As part of these recent developments, Blue Owl Capital Corp III is positioning itself for sustained growth and operational expansion, showing its commitment to maintaining a robust financial foundation.
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