Owl Rock and Dyal Capital Merge
Owl Rock Capital Group and Dyal Capital Partners agree to merge and go public. They will do this through Altimar Acquisition Corp, which is a blank-check company, or SPAC. The new company is now Blue Owl Capital Inc. and has a valuation of $12.5 billion. It manages $45 billion in assets and will be listed on the New York Stock Exchange. This deal will close during the first half of the year.
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The Business of SPACs
SPACs are popular in the business world today, and this popularity is likely to continue. “SPACs are popular because there is a risk to not knowing where the money is going to be invested, but the money is safely put in a trust. This is now seen as a legitimate alternative to the IPO for going public on one of the major stock exchanges,” Brad Shiffman, a partner at Blank Rome, told The Buttonwood Tree. Shiffman has extensive experience with SPACs and how they are structured and negotiated.
“Valuation is very important,” he said. By definition, valuation of a target company in a SPAC merger is subject to negotiation. As a result, the valuation must appropriate for the shareholders. If not, the deal could result in increased redemptions, which means less operating cash for the sponsored company.
Blank Rome has a process of their own, when deciding on which clients to work with. “In terms of which clients we choose, it’s no different than our process
for any other client intake,” Shiffman said. “We review all of our clients as to whether or not we’ll take them. Some of the SPACs we have worked on – when you’re on the company side- we’ve had relationships with a lot of the people. Or they are people who are recommended or referred from other clients, so that helps on the intake process.”
The underwriters are important to the process, as well. “In a lot of the deals that we do, we represent the underwriters, so they us usually underwriters we have relationships with, as well. That’s really the main intake, but if it’s somebody we don’t do know we will investigate and see if that’s someone we feel comfortable with representing,” he said.
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“Owl Rock and Dyal Capital Merge,” by Haley Cafarella was published in The Buttonwood Tree on January 15, 2021.