Blue Owl Capital Corporation Merger Terminated after Shareholder Claims

Blue Owl Capital Merger Terminated: Investment Investigation Update

Blue Owl Capital Corporation (NYSE: OBDC) and Blue Owl Capital Corporation II (formerly OBDC II) have terminated their previously proposed merger, citing current market conditions, according to a report on November 19, 2025. This decision comes just months after earlier updates related to supplemental disclosures regarding the merger.

Blue Owl Calls Off Planned Merger of OBDC and OBDC II

Although the companies previously maintained that the transaction could create long-term value for shareholders, both boards have decided not to move forward with the merger at this time. The CEO of OBDC and OBDC II, stated that despite the potential benefits, “current market conditions” prompted the decision to withdraw the proposal.

Key new updates include:

• The stock-for-stock merger is officially terminated.

• OBDC II will reportedly reinstate its tender program in Q1 2026, pending board approval.

Background: Prior Shareholder Claims of Misleading Disclosures

Earlier in 2024, both OBDC and Blue Owl Capital Corporation III (OBDE) addressed shareholder claims alleging inadequate or misleading disclosures related to the merger process. While the companies denied any wrongdoing, they reportedly issued supplemental disclosures to avoid potential litigation costs.

Previous updates included:

• A $0.52 special dividend declared by OBDE, payable by January 31, 2025.

• Additional disclosures regarding the OBDC special committee, its members, and further financial details.

With the merger now abandoned, it remains unclear how these prior shareholder concerns may affect future corporate actions.

Higher Interest Rates and the Outlook for BDCs

According to reports from BlueVault and Fitch, non-traded BDCs continue to face challenges due to:

• Rising interest rates

• Decreasing asset quality

• Slowing access to capital among middle-market borrowers

• Increasing debt burdens

BDCs often invest in private, PE-backed companies that may be more vulnerable under tightening credit conditions. Like non-traded REITs, non-traded BDCs can be illiquid, high-risk, and complex, often carrying high commissions.

Risks of Investing in BDCs

Investors should be aware of the following risks when investing in non-traded BDCs:

• Loss of principal, particularly if underlying corporate loans decline in value.

• Market and economic uncertainty, which can impact credit performance.

• Interest-rate sensitivity, including higher borrowing costs for portfolio companies.

• Liquidity restrictions, especially in non-traded BDCs.

• Potential conflicts of interest due to high commissions and internal fee structures.

Broker Due Diligence Obligations

Broker-dealers recommending BDCs must:

• Conduct reasonable due diligence on the investment.

• Ensure recommendations are suitable based on an investor’s age, risk tolerance, net worth, and financial objectives.

• Disclose all material risks, fees, liquidity restrictions, and conflicts.

Failure to do so may result in liability through a FINRA arbitration claim.

Potential Lawsuits to Recover Investment Losses

The White Law Group is investigating potential FINRA arbitration claims involving Blue Owl Capital (OBDC, OBDC II, OBDE) and other high-risk BDC investments. Due to high commissions and limited liquidity, some financial advisors may have unsuitably recommended these products to retail investors.

If you suffered losses investing in Blue Owl Capital’s BDCs, you may be able to pursue recovery through a FINRA arbitration claim.

For a free consultation, contact The White Law Group at 1-888-637-5510.

About The White Law Group

The White Law Group, LLC is a national securities arbitration law firm with offices in Chicago, Illinois, and Seattle, Washington. The firm has represented investors in over 800 FINRA arbitration cases nationwide.

Frequently Asked Questions (FAQs)

1. Why was the Blue Owl merger canceled?

According to the companies, the merger was terminated due to current market conditions, despite their belief that a combined BDC could create long-term shareholder value. Both funds plan to continue operating independently.

2. Can investors still redeem shares of OBDC II?

OBDC II has announced plans to reinstate its quarterly tender program in Q1 2026, pending board approval. Historically, all quarterly tenders have been fully satisfied.

3. Can I recover losses from Blue Owl BDC investments through FINRA arbitration?

Possibly. If your financial advisor misrepresented risks, recommended BDCs unsuitably, or failed to perform proper due diligence, you may be eligible to pursue recovery through a FINRA arbitration claim.