#United States #New York #Blue Owl Capital #Saba Capital #Cox Capital

Blue Owl Capital Corporation II's Board Advises Rejection of Tender Offer

In an assertive response to recent events, the Board of Directors of Blue Owl Capital Corporation II (OBDC II) has unanimously recommended that shareholders reject an unsolicited minority tender offer from Cox Capital Partners and Saba Capital Management for up to 8 million shares for about $30 million. This offer has been criticized for being grossly undervalued, representing a significant 33.2% discount to the company’s net asset value (NAV).

Implications of Accepting the Offer

The Board is concerned that accepting this minority offer would potentially harm shareholders by allowing Cox and Saba to capture value at the expense of existing investors. They emphasize this offer's inadequate nature and remind shareholders that by tendering their shares, they would not only sell their ownership at a significantly reduced price but also forfeit future dividends and potential capital appreciation. The Board's communication clearly states that shareholders should ignore any offer materials they receive regarding the tender offer, affirming that there are no benefits in tendering their shares at this moment.

Board's Diligent Process

The recommendation comes after a thorough review by the Board, which included consultations with management, financial, and legal advisers. They considered the historical financial performance, the current portfolio of assets, and future growth opportunities before arriving at a conclusion. Importantly, the Board also referenced an opinion from BofA Securities, which pointed out that the offered price is financially inadequate.

Delivering Superior Value

OBDC II has demonstrated a robust performance record, having delivered an annualized return of 9.1% since its inception, effectively outpacing leveraged loan indices. The Board is proactively taking measures to return capital to shareholders, with plans for distributions in the vicinity of 50% or more of OBDC II's net assets by 2026. This includes a significant return of capital distribution, projected to be around 30% of NAV, to be issued on or before the end of March. Additionally, shareholders can expect regular monthly dividends alongside significant quarterly returns of capital.

Focus on Shareholder Interests

Looking ahead, Blue Owl remains committed to maximizing shareholder value. The Board articulated their dedication to protect investor interests and ensuring the long-term appreciation of share value through disciplined execution of its investment strategies.

Conclusion

Shareholders of Blue Owl Capital Corporation II are encouraged to remain informed and cautious regarding the unsolicited tender offer from Cox and Saba. This communication serves as a reminder that the Board of Directors stands united in advocating for the long-term interests of all investors, and they continue to prioritize strategic actions that enhance shareholder value. Stakeholders are advised to remain vigilant and ignore any solicitation related to the tender offer, reinforced by the underlying confidence in OBDC II’s promising performance trajectory.