Business context and reporting period
This is Altimar Acquisition Corporation’s unaudited Form 10-Q for the quarter ended March 31, 2021, filed May 17, 2021—not an operating-company 10-Q filed by Blue Owl Capital Inc. Altimar was a blank-check company pursuing a business combination with Owl Rock and Dyal to form Blue Owl Capital.
Altimar reported that it had not commenced operations and had generated no operating revenue. The proposed transaction was described as valuing the combined company at an estimated $12.5 billion pro forma equity value, with more than $45 billion in assets under management and a $1.5 billion committed common-stock private investment at $10 per share. These are transaction estimates, not results for the reporting period.
Financial results and position
| Metric | Three months ended March 31, 2021 / period-end |
|---|---|
| Operating revenue | None reported; Altimar had not begun operations. |
| Operating costs and operating loss | $155,920. |
| Net income | $13,655,787, principally reflecting a $13,766,548 noncash gain from the decrease in warrant-liability fair value; Trust Account interest was $45,159. |
| Net income per share | $0.00 for redeemable Class A shares and $1.98 for nonredeemable Class B shares. The allocation reflects the company’s two-class accounting; it is not an indication of operating profitability. |
| Cash flow | Operating cash used was $102,669; financing cash used was $48,965; cash declined $151,634 to $777,132. |
| Trust Account | $275,083,187, primarily U.S. Treasury securities; no Trust Account interest had been withdrawn through quarter-end. |
| Liabilities and liquidity | Total liabilities were $30,924,154, including $21,208,265 of warrant liability and a $9,625,000 deferred underwriting fee payable upon a completed business combination. Current liabilities were $90,889. No working-capital loans or long-term debt were outstanding. |
| Equity and redeemable shares | Shareholders’ equity was approximately $5.0 million. Class A shares classified outside equity as subject to possible redemption totaled $240,230,050, representing 24,023,005 shares at $10 each. |
Material changes versus prior period
- Compared with December 31, 2020, Trust Account assets increased about $45,000, while cash outside the Trust Account decreased from $928,766 to $777,132.
- Warrant liability fell from $34,974,813 to $21,208,265, producing the quarter’s $13,766,548 noncash gain. The filing states the valuation relies on Level 3 inputs and a Monte Carlo model.
- Redeemable Class A shares increased from 22,657,426 to 24,023,005, with their carrying value rising from $226,574,260 to $240,230,050.
- The filing does not provide a comparable prior-year quarterly income statement, so year-over-year operating comparisons are not clear from the filing text.
Outlook, risks and unusual items
- Altimar had until October 27, 2022 to complete a business combination; otherwise it was required to redeem public shares and liquidate, subject to the filing’s terms. There is no assurance the proposed transaction would close.
- Management expected ongoing costs related to public-company reporting and the proposed transaction. It said it did not expect to need additional funds for planned expenditures, but warned that underestimated transaction-search costs or significant redemptions could create funding needs.
- Shareholder lawsuits and a demand letter alleged fiduciary-duty breaches related to the proposed Owl Rock/Dyal transaction. The company considered the claims without merit, but said it could not estimate potential losses and recorded no loss contingency.
- Management said COVID-19 could negatively affect financial position, results or the target search, but the specific impact was not determinable.
- Disclosure controls and procedures were concluded to be ineffective solely because of the restatement of 2020 financial statements following the SEC staff’s position that the warrants should be classified as liabilities. Management reported no material change in internal control during the quarter.
- No earnings guidance for an operating business was provided. The reported net income was driven by noncash warrant revaluation, not business operations.
Important facts for investors to verify
- Confirm the filing entity and period: this is Altimar Acquisition Corporation’s pre-combination SPAC filing, not Blue Owl Capital’s operating-company financial report.
- Check the subsequent status and final terms of the Owl Rock/Dyal business combination and the proposed $1.5 billion private investment; the transaction figures here are estimates.
- Review warrant-liability valuation assumptions and the effect of warrant remeasurement on reported earnings.
- Track public-share redemptions, remaining outside-trust cash, and any additional financing requirements.
- Monitor the shareholder litigation and remediation of the control issue that led to the 2020 restatement.