Blue Owl BDCs repurchase $90m of shares as private credit market stabilises
Blue Owl Capital repurchased a combined $90m of shares across two of its business development companies during Q2, extending its share buyback programme as the private credit manager looks to support investor value amid continued volatility in the sector, according to a report by Bloomberg.
Blue Owl Capital bolstered its commitment to share buybacks in Q2 as the private credit sector stabilises, buying back a combined $90 million of shares across its two business development companies (BDCs), according to Bloomberg. The firm's flagship private credit vehicle, Blue Owl Capital Corporation (OBDC), repurchased around $35 million of its shares during the quarter.
NAV for OBDC slipped by 1% to $14.26 per share, as valuation reductions on a few portfolio companies were partially offset by share repurchases. OBDC CEO Craig Packer noted the improving market conditions are generating attractive investment opportunities and enable OBDC to deploy capital selectively. Despite a stable NAV of $16.48 per share for its technology-focused BDC, Blue Owl Technology Finance Corp, repurchased approximately $55 million of stock during the period.
Portfolio performance remained resilient, albeit with an increase in non-accruals to 2.8% of investments at cost, up from 2.0% in the prior quarter. Deployment slowed, with $319 million of new investment commitments versus $747 million of loan repayments. The $1.8 trillion private credit market has been under scrutiny over valuation, liquidity concerns, and the potential influence of AI on software sector borrowers.
Blue Owl has been cautious in recent months, limiting withdrawals from certain private credit vehicles amid heightened redemption requests. The latest results indicate Blue Owl is adopting a disciplined approach to capital allocation while using share repurchases to boost shareholder value as private credit sector conditions improve.
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