Filing Overview
Registrant: Owl Rock Technology Finance Corp. (now identified in the request metadata as Blue Owl Technology Finance Corp.)
Filing: Form 8-K, Item 2.02, furnished February 8, 2019, reporting an initial year-end update as of December 31, 2018. The registrant was an emerging growth company.
Business Context and Capitalization
The company conducts private offerings of common shares to accredited investors. Investors make capital commitments and fund drawdowns when requested by the company.
- Total capital commitments: $1.8 billion.
- Undrawn commitments: $1.5 billion.
- Affiliate or adviser-related commitments: $65 million, of which $58.4 million was undrawn.
- The initial private-offering closing occurred on August 10, 2018.
Portfolio and Investment Activity
- Investments in six portfolio companies.
- Aggregate portfolio par value: $266.9 million.
- Portfolio composition by par value: 81.6% first-lien senior secured debt, 7.4% second-lien senior secured debt and 11.0% unsecured debt.
- 89.0% of investments by par value carried floating rates, generally based on LIBOR.
| Portfolio company | Primary investment exposure | Par value | Percentage of par |
|---|---|---|---|
| Lightning Midco, LLC, doing business as Vector Solutions | First-lien senior secured loans | $90.7 million | 34.0% |
| Gerson Lehrman Group, Inc. | First-lien senior secured loan | $74.8 million | 28.0% |
| Bracket Intermediate Holding Corp. | First- and second-lien senior secured loans | $32.0 million | 12.0% |
| Uber Technologies, Inc. | Unsecured notes | $30.0 million | 11.2% |
| Cheese Acquisition, LLC | First-lien senior secured loan | $14.4 million | 5.4% |
| Space Exploration Technologies Corp. | First-lien senior secured loan | $25.0 million | 9.4% |
The portfolio also included unfunded delayed-draw term-loan and revolving-loan commitments. The filing does not provide a separate aggregate amount for these unfunded investment commitments.
Profitability, Cash Flow, Debt and Liquidity
The filing does not provide revenue, net investment income, net income, cash flow, margins, debt balances, borrowing capacity, net asset value, or liquidity ratios.
The $1.5 billion of undrawn investor commitments represents available capital commitments, but the filing does not state the amount currently available for investment after considering any conditions, expenses or other limitations.
Material Changes Versus Prior Comparable Period
The filing text does not provide a prior comparable period or a quantified year-over-year comparison. Accordingly, changes in portfolio size, earnings, cash flow, leverage and liquidity cannot be determined from this filing.
Guidance, Outlook, Risks and Unusual Items
- No earnings or investment guidance is provided.
- The disclosure is characterized as an initial year-end update and is furnished for informational purposes.
- Key portfolio risks include borrower credit risk, concentration in a limited number of companies, exposure to unsecured debt, floating-rate exposure tied to LIBOR and the potential for unfunded commitments to require additional capital.
- The filing states that the information is not an offer to sell securities or a solicitation to purchase securities and should not be relied upon as the basis for an investment decision.
- The filing does not report defaults, non-accruals, impairments, realized gains or losses, contingencies or unusual charges.
Investor Verification Items
- Verify the registrant’s current legal name and any changes from Owl Rock Technology Finance Corp. to Blue Owl Technology Finance Corp.
- Confirm the valuation and fair value of the $266.9 million portfolio, since the disclosed amounts are par values.
- Review the subscription documents governing the $1.8 billion of capital commitments, including drawdown conditions and expiration terms.
- Assess concentration risk, particularly the exposures to Vector Solutions and Gerson Lehrman Group.
- Review subsequent filings for income, cash flow, leverage, liquidity, portfolio performance, defaults, impairments and changes in LIBOR-based pricing.