Blue Owl's co-CEOs rule out taking the firm private after a 70% share fall

A stock that has fallen 70%, as Blue Owl's has according to Semafor, has to rise about 233% to get back to its old price ^[13]. Founders who think the market has misjudged them can capture that gap by buying the company. Semafor described a management buyout as the classic fix for a firm heavily controlled by its founders and unloved by stockholders ^[10]. Doug Ostrover thinks the market has misjudged them. "I think there's a really big disconnect between what's actually happening in private credit versus what the market thinks," he said ^[17].

The pair still declined to buy at a price they say is too low ^[5]. That keeps the founders' own capital out of a bid for the shares and leaves the recovery with public holders. Lipschultz put it this way: "Public shareholders are going to benefit from the rise in this stock" ^[6].

Lending is the weakest candidate to deliver that rise. Investors in Blue Owl's funds, and in those of peers including Blackstone and Apollo, want their money back, and because the loans cannot be sold quickly the firms have limited redemptions ^[8]. Liz Hoffman, who hosted the episode, called it "a slow moving run on a very big bank" ^[11]. She has written that the panic is overblown ^[12]. Even so, she said a healthy credit book is unlikely to be the growth engine that built the firm ^[15]. Semafor said that puts more pressure on Blue Owl's other businesses, particularly its role as a landlord to AI data centers ^[14].

Lipschultz defended that business with a credit argument. "All we really are determining is: are Microsoft and Amazon going to pay their bills?" he said ^[7]. The framing turns a question about AI demand into a question about two tenants' willingness to pay rent, and it holds for as long as the leases run. Semafor's account does not include the lease terms, the rents, or the size of the data-center book next to the credit business. Those figures would show how much of a 233% recovery the landlord business could carry ^[13].

Ostrover's case for the perception gap rests partly on First Brands, an auto-parts company that did not borrow in the direct market and went bankrupt ^[1]. "I believe there was fraud," he said ^[2]. If he is right, redemption limits ease and lending can grow again. Should the loan-quality questions regulators are raising turn into losses as high rates squeeze borrowers ^[9], the data centers carry growth alone. And a stock still down after the 18 months over which Ostrover expects "fantastic results" ^[16] brings the buyout question back.

I think the refusal says more about what the listing is worth to the founders than about where the shares trade. "We went public for a reason and that reason stands," Lipschultz said ^[3]. The counter-case is that a take-private would need financing from a market that has turned against private credit ^[4], so the refusal may reflect what money is available. The data-center thesis is wrong if Blue Owl's credit funds lift their redemption limits and grow again within the 18 months Ostrover named ^[16].