Benjamin Sinclair’s opinion piece on Blue Owl Capital reads less like analysis and more like an apology brief for an asset class under strain. By omitting nearly every material fact that makes this episode significant, I believe the article does Investment Executive readers a disservice.
Sinclair fails to mention that in November 2025, Blue Owl attempted to merge OBDC II into its publicly traded sibling at terms that would have imposed a roughly 20% loss on OBDC II investors. The advisor community revolted, the merger was killed within days and a class action lawsuit followed alleging material misrepresentation of redemption pressures. He omits that Blue Owl halted quarterly redemptions in November — not last week — and has continued collecting incentive fees from locked-out investors throughout. None of this appears in his account.
His core argument — that the US$1.4 billion loan sale at 99.7% of par validates the portfolio — proves too much and too little. Only US$600 million came from OBDC II, roughly one-third of a US$1.6 billion portfolio. As Morningstar has observed, the firm likely sold the assets it was best positioned to sell and future sales may prove more difficult. Citing the sale price of the best third as evidence that the whole is sound should not survive editorial scrutiny at a publication serving financial professionals.
More troubling: one of the four institutional buyers, Kuvare, is reportedly a Blue Owl affiliate following the firm’s US$750 million acquisition of Kuvare Asset Management in 2024. If accurate, this means the manager may have transferred loans from its retail fund to its own insurance platform — a conflict-of-interest question Sinclair does not acknowledge, much less examine.
The structural issue he glosses over is the one that matters most. OBDC II was marketed to retail investors as a semi-liquid vehicle with quarterly redemptions at NAV. Those investors have now endured a proposed merger at a 20% haircut, a redemption freeze, a cancellation and a unilateral conversion to a manager-controlled wind-down of indefinite duration. To tell them — as Sinclair does — that if they cannot tolerate illiquidity they should avoid illiquid funds is to blame the buyer for defects in the product.
Former Goldman Sachs CEO Lloyd Blankfein, speaking to The Wall Street Journal this week, was considerably more candid. These securities are opaque and carry real risk, he observed, and when individuals, insurance companies or pension funds lose money, the consequences are severe.
He called the industry’s push into retail and insurance channels short-sighted. Meanwhile, OBDC II’s redemption requests were exceeding the 5% quarterly cap, and Blue Owl’s technology-focused vehicle saw requests spike to approximately 15% of net asset value. This is not a narrative problem at a single fund. It is a structural mismatch the industry has been slow to confront and that commentators like Mr. Sinclair appear eager to deflect.
Your readers are financial professionals. They deserve the full factual record, not selective reassurance from a commentator who is not a disinterested party.