Finance
Blue Owl Technology Finance Secures BBB Rating for $650M Notes, Plans $15.8B Merger
KBRA has assigned a BBB rating with a Stable outlook to Blue Owl Technology Finance Corp.’s (OTF) $650 million senior unsecured notes due March 2028. OTF operates within the $128.4 billion Blue Owl Credit platform and maintains a $6.4 billion diversified investment portfolio, primarily consisting of first lien senior secured loans (69.6%) in technology-focused companies.
The company’s portfolio includes traditional financing (75.1%) with weighted average EBITDA of $201 million, and growth capital (23.9%) with average annual revenue of $724 million. Key sector exposures include Systems Software (23.9%), Health Care Technology (16.0%), and Application Software (14.0%). The company maintains solid financial metrics with gross and net leverage of 0.84x and 0.78x respectively, and 218% asset coverage.
OTF has announced a merger with Blue Owl Technology Finance Corp. II, expected to close in 2Q25, creating a combined entity with approximately $15.8 billion in total assets at fair value.
KBRA ha assegnato un rating BBB con un outlook stabile alle note senior non garantite da 650 milioni di dollari di Blue Owl Technology Finance Corp. (OTF), in scadenza a marzo 2028. OTF opera all’interno della piattaforma di credito Blue Owl, del valore di 128,4 miliardi di dollari, e mantiene un portfolio di investimenti diversificato di 6,4 miliardi di dollari, composto principalmente da prestiti garantiti di primo grado (69,6%) in aziende focalizzate sulla tecnologia.
Il portafoglio della società include finanziamenti tradizionali (75,1%) con un EBITDA medio ponderato di 201 milioni di dollari e capitale di crescita (23,9%) con un fatturato medio annuale di 724 milioni di dollari. Le principali esposizioni settoriali includono software di sistema (23,9%), tecnologia sanitaria (16,0%) e software applicativo (14,0%). La società mantiene solidi indicatori finanziari con leva finanziaria lorda e netta rispettivamente di 0,84x e 0,78x, e una copertura patrimoniale del 218%.
OTF ha annunciato una fusione con Blue Owl Technology Finance Corp. II, prevista per chiudere nel secondo trimestre del 2025, creando un’entità combinata con circa 15,8 miliardi di dollari in attivi totali a valore equo.
KBRA ha asignado una calificación BBB con perspectiva estable a las notas senior no garantizadas de 650 millones de dólares de Blue Owl Technology Finance Corp. (OTF), que vencen en marzo de 2028. OTF opera dentro de la plataforma de crédito de Blue Owl, que tiene un valor de 128.4 mil millones de dólares, y mantiene un portafolio de inversiones diversificado de 6.4 mil millones de dólares, compuesto principalmente por préstamos garantizados de primer grado (69.6%) en empresas enfocadas en tecnología.
El portafolio de la compañía incluye financiamiento tradicional (75.1%) con un EBITDA promedio ponderado de 201 millones de dólares, y capital de crecimiento (23.9%) con ingresos anuales promedio de 724 millones de dólares. Las exposiciones clave por sector incluyen software de sistemas (23.9%), tecnología de salud (16.0%) y software de aplicaciones (14.0%). La compañía mantiene sólidos indicadores financieros con apalancamiento bruto y neto de 0.84x y 0.78x, respectivamente, y una cobertura de activos del 218%.
OTF ha anunciado una fusión con Blue Owl Technology Finance Corp. II, que se espera cerrar en el segundo trimestre de 2025, creando una entidad combinada con aproximadamente 15.8 mil millones de dólares en activos totales a valor razonable.
KBRA는 Blue Owl Technology Finance Corp.(OTF)의 6억 5천만 달러 규모의 만기 2028년 3월의 비담보 채권에 대해 BBB 등급 및 안정적인 전망을 부여했습니다. OTF는 1,284억 달러 규모의 Blue Owl 신용 플랫폼 내에서 운영되며, 주로 기술 중심 기업의 선순위 담보 대출(69.6%)로 구성된 64억 달러의 다각화된 투자 포트폴리오를 유지하고 있습니다.
회사의 포트폴리오는 전통적인 자금 조달(75.1%)을 포함하며, 가중 평균 EBITDA는 2억 1백만 달러이고, 성장 자본(23.9%)은 연평균 수익 7억 2천4백만 달러를 기록하고 있습니다. 주요 산업 노출에는 시스템 소프트웨어(23.9%), 의료 기술(16.0%) 및 애플리케이션 소프트웨어(14.0%)가 포함됩니다. 회사는 각각 0.84x 및 0.78x의 총 및 순 부채 비율과 218%의 자산 커버리지를 유지하고 있습니다.
OTF는 Blue Owl Technology Finance Corp. II와의 합병을 발표했으며, 2025년 2분기에 마감될 예정이며, 공정 가치로 약 158억 달러의 총 자산을 가진 결합된 법인을 창출할 예정입니다.
KBRA a attribué une note BBB avec une perspective stable aux obligations senior non sécurisées de 650 millions de dollars de Blue Owl Technology Finance Corp. (OTF), arrivant à échéance en mars 2028. OTF opère au sein de la plateforme de crédit Blue Owl d’une valeur de 128,4 milliards de dollars et maintient un portefeuille d’investissements diversifié de 6,4 milliards de dollars, principalement composé de prêts garantis de premier rang (69,6%) dans des entreprises axées sur la technologie.
Le portefeuille de la société comprend un financement traditionnel (75,1%) avec un EBITDA moyen pondéré de 201 millions de dollars, et un capital de croissance (23,9%) avec des revenus annuels moyens de 724 millions de dollars. Les principales expositions sectorielles incluent le logiciel système (23,9%), la technologie de la santé (16,0%) et le logiciel applicatif (14,0%). La société maintient des indicateurs financiers solides avec un effet de levier brut et net de 0,84x et 0,78x respectivement, et une couverture d’actifs de 218%.
OTF a annoncé une fusion avec Blue Owl Technology Finance Corp. II, qui devrait se clôturer au deuxième trimestre de 2025, créant une entité combinée avec environ 15,8 milliards de dollars d’actifs totaux à la juste valeur.
KBRA hat Blue Owl Technology Finance Corp.s (OTF) 650 Millionen Dollar Senior Unsecured Notes mit einer BBB-Bewertung und stabiler Aussichten bewertet, die im März 2028 fällig sind. OTF operiert innerhalb der 128,4 Milliarden Dollar schweren Blue Owl Kreditplattform und verwaltet ein 6,4 Milliarden Dollar diversifiziertes Investitionsportfolio, das hauptsächlich aus vorrangigen gesicherten Darlehen (69,6%) in technologieorientierten Unternehmen besteht.
Das Portfolio des Unternehmens umfasst traditionelle Finanzierungen (75,1%) mit einem gewichteten durchschnittlichen EBITDA von 201 Millionen Dollar und Wachstumskapital (23,9%) mit einem durchschnittlichen Jahresumsatz von 724 Millionen Dollar. Schlüsselbranchen sind Systemsoftware (23,9%), Gesundheitstechnologie (16,0%) und Anwendungssoftware (14,0%). Das Unternehmen weist solide Finanzkennzahlen mit einer Brutto- und Nettoverschuldung von 0,84x bzw. 0,78x und einer Vermögensdeckung von 218% auf.
OTF hat eine Fusion mit Blue Owl Technology Finance Corp. II angekündigt, die voraussichtlich im 2. Quartal 2025 abgeschlossen werden soll, wodurch ein kombiniertes Unternehmen mit einem Gesamtvermögen von etwa 15,8 Milliarden Dollar zum Marktwert entsteht.
Positive
- Strong portfolio diversification with 69.6% in first lien senior secured loans
- Solid financial metrics with gross leverage of 0.84x, below target range
- Robust asset coverage ratio of 218%
- Low non-accrual rate of 0.1% at fair value
- Strategic merger to create $15.8B combined asset entity
Negative
- High exposure (20%) to more volatile preferred and common equity
- $1.2 billion of unsecured notes due within two years
- Exposure to economic uncertainties including high base rates and inflation
Insights
This BBB rating assignment with a stable outlook for Blue Owl Technology Finance Corp.’s
The upcoming merger with Blue Owl Technology Finance Corp. II will create a substantially larger entity with
The portfolio composition reveals sophisticated risk management and sector positioning. The focus on technology lending with major allocations to systems software (
The minimal non-accrual rate of
KBRA assigns a rating of BBB to Blue Owl Technology Finance Corp. (“OTF” or “the company”)
Key Credit Considerations
OTF benefits from its ties to the
OTF maintains a
The company has diversified funding sources including a bank revolving credit facility, SPV asset facilities, CLOs, and unsecured notes. Post 3Q24 quarter-end, the SPV Asset Facility was upsized to
Following the Pluralsight LLC restructuring, credit quality is solid with only one portfolio company on non-accrual comprising
The credit strengths are counterbalanced by the relatively illiquid investments and retained earnings constraints as a RIC. The potential for increased non-accruals with a more uncertain economic environment with high base rates, inflation, and geopolitical risk.
On November 13, 2024, Blue Owl Technology Finance Corp. and Blue Owl Technology Finance Corp. II announced that they entered into a definitive merger agreement, with OTF as the surviving company. The combined company will have approximately
Formed in July 2018 as a Maryland Corporation, Blue Owl Technology Finance Corp. (“OTF” or “the company”) is a
Rating Sensitivities
In the intermediate future, a rating upgrade is not expected. A rating downgrade and/or Outlook change to Negative could be considered if there is a significant downturn in the
To access ratings and relevant documents, click here.
Methodologies
Disclosures
A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.
Information on the meaning of each rating category can be located here.
Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.
About KBRA
Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the
Doc ID: 1007536
View source version on businesswire.com: https://www.businesswire.com/news/home/20250113850636/en/
Analytical Contacts
Teri Seelig, Managing Director (Lead Analyst)
+1 646-731-2386
teri.seelig@kbra.com
Kevin Kent, Director
+1 301-960-7045
kevin.kent@kbra.com
Business Development Contact
Constantine Schidlovsky, Senior Director
+1 646-731-1338
constantine.schidlovsky@kbra.com
Source: Kroll Bond Rating Agency, LLC
FAQ
What is the rating assigned by KBRA to Blue Owl Technology Finance Corp.’s notes?
KBRA assigned a BBB rating with a Stable outlook to Blue Owl Technology Finance Corp.’s $650 million senior unsecured notes due March 15, 2028.
What is the current size and composition of OTF’s investment portfolio?
OTF maintains a $6.4 billion diversified investment portfolio, with 69.6% in first lien senior secured loans, 75.1% in traditional financing, and 23.9% in growth capital investments.
What are the key sector exposures in OTF’s portfolio as of Q3 2024?
The top three sector exposures are Systems Software (23.9%), Health Care Technology (16.0%), and Application Software (14.0%).
What is the expected impact of the merger between OTF and Blue Owl Technology Finance Corp. II?
The merger, expected to close in Q2 2025, will create a combined company with approximately $15.8 billion of total assets at fair value once all capital is called and target leverage is reached.
What are OTF’s current leverage ratios and asset coverage?
OTF’s gross leverage is 0.84x and net leverage is 0.78x, both below the target range of 0.9x to 1.25x, with an asset coverage ratio of 218%.
“Everything must be prepared now,” he added, while also emphasizing “we are ready to find solutions. We are extending our hand, but we are not prepared to be blackmailed.”
French President Emmanuel Macron’s office had announced Sunday that France would ask the EU to activate the bloc’s Anti-Coercion Instrument, nicknamed the trade bazooka.
Germany is usually more reluctant to take such far-reaching measures, not least to protect its ailing and export-dependent economy. But Klingbeil’s latest comments signal a willingness to take a harder line with Washington — at least on the part of his Social Democrats, that govern in a coalition government with Chancellor Friedrich Merz’s conservatives.
“We are constantly experiencing new provocations. We are constantly experiencing new antagonism, which President Trump is seeking. And here we Europeans must make it clear that the limit has been reached,” Klingbeil said.
All eyes are now on Merz, who will speak to journalists later on Monday and has in the past been more conciliatory toward the Trump administration than the center-left vice chancellor.
The Newton Finance Committee gathered on Monday to discuss the allocation of a $300,000 transfer to two new management positions in the mayor’s office, chief of community services and chief of staff.
Chief Operating Officer (COO) Josh Morse, explained that these two new positions are aimed at both supporting the ongoing work and reducing the amount of work that comes to the COO’s table.
“It’s a growth period—more of an institutional growth, not necessarily budget growth,” Morse said.
Maureen Lemieux, chief financial officer (CFO) for the mayor’s office, emphasized that the funding request relies on repurposing existing salary funds that will not be used this fiscal year, rather than drawing from reserves or new revenue sources.
“We didn’t want to ask to take money from free cash or even the budget reserve,” Lemieux said. “We wanted to repurpose funds that had already been budgeted this year for salaries for these couple of positions.”
Instead of drawing smaller amounts of funds from several different departments, they decided to draw greater amounts from fewer departments to make the process simpler, explained Lemieux.
“We’re asking to take the money from three different departments,” Lemieux said.
Morse has worked for the city for the past 18 years, five of which he’s spent in the executive office, and he explained how past COOs have been trampled by their workload.
“It was always one single person managing all of the departments, supporting all of our city councilors, supporting 88,000 residents and 13 villages,” Morse said. “There were so many things that those incredible employees wanted to accomplish, but they just struggled to even get away from their desk because they were triple, quadruple booked every hour of the day.”
Morse also believes that working directly with people and stepping into the community is more important than looking at paperwork all day.
“Opportunities to really discuss what we can do as a city to help improve working conditions or just make sure that we’re adequately supporting and maximizing efficiencies with our frontline staff are important,” Morse said. “And conveying, you know, the message, about how much we support them and how much we really appreciate the work that they do and listening, really listening to them.”
This $300,000 transfer will not only benefit Morse and his ability to remain in close contact with the city, but it will also allow Lemieux to step down for retirement and train the new CFO, Lemieux explained.
“In addition to that, what we’re asking for is funding to allow me to retire in about 6 months, for us to be able to search for and bring on a new CFO before I go, so that we can have some time for an overlap between my tenure and when the new CFO would take over,” Lemieux said.
Although the committee ultimately agreed to the $300,000 budget transfer, they raised concerns about whether the vacant positions from which the funds were reallocated could be filled.
“We are absolutely not putting those positions on hold … there is absolutely no intent to be shorting that department,” Lemieux said.
Lemieux reiterated that the funds would be taken out of practicality rather than necessity, meaning that those departments could still hire if needed.
Morse then emphasized that these positions would provide needed growth to Newton by allowing the Mayor’s office to continue working efficiently and growing.
“If people see that upward mobility and support, they’re more likely to stick around, and it’s better for us because it makes us more resilient as a city,” Morse said.
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