Blue Owl Capital Corp (NYSE:OBDC) has officially increased its authorized shares of common stock from 500 million to 1 billion, a move that became effective immediately after the company filed Articles of Amendment with the Maryland State Department of Assessments and Taxation on Monday.
The New York-based asset management firm, previously known as Owl Rock Capital (NYSE:OBDC) Corp, stated that the authorized preferred stock remains unchanged, with no shares designated as preferred stock. The amendment to the company's Articles of Amendment and Restatement is aimed at expanding the number of common shares available for corporate purposes.
Blue Owl Capital's decision to increase its share count does not immediately affect the number of shares currently issued and outstanding; it simply enlarges the pool of shares the company can issue in the future. The company's stock, which trades under the ticker symbol OBDC, is listed on the New York Stock Exchange.
In other recent news, Blue Owl Capital announced a robust quarter, along with a merger agreement with Blue Owl Capital Corporation III (OBDE). The merger, which is subject to shareholder approval, is expected to make Blue Owl the second-largest publicly traded Business Development Company (BDC) by total assets.
The company reported a net investment income of $0.48 per share, a net asset value of $15.36 per share, and a 12.6% annualized return on equity. Despite a slight decrease in net asset value due to credit markdowns, the company's portfolio remains resilient with a non-accrual rate of 1.4%.
The merger is anticipated to enhance the company's scale, improve trading liquidity, and contribute to net investment income through operational and cost savings. Blue Owl's management is confident that the merger will create synergies and potentially drive GAAP ROEs above 10%. The merger is expected to close in the first quarter of 2025.
InvestingPro Insights
As Blue Owl Capital Corp (NYSE:OBDC) positions itself for strategic flexibility with the increase in authorized shares of common stock, investors can gain additional insights by considering the latest data and analysis from InvestingPro. With a market capitalization of $5.6 billion and a P/E ratio of 7.96, the company presents an interesting valuation profile. Notably, the company has been profitable over the last twelve months, and analysts have recently revised their earnings upwards for the upcoming period, indicating potential confidence in the company's financial prospects.
InvestingPro Tips reveal that Blue Owl Capital pays a significant dividend to shareholders, with a current dividend yield of 12.17%, which is attractive for income-focused investors. However, it's important to note that the company's short-term obligations exceed its liquid assets, which could pose a liquidity risk. Additionally, the valuation implies a poor free cash flow yield, suggesting that investors should be mindful of the company's cash generation efficiency relative to its market value.
For those looking to delve deeper into the company's financial health and future outlook, additional InvestingPro Tips are available at https://www.investing.com/pro/OBDC, providing a more comprehensive analysis of Blue Owl Capital Corp.
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