March 5 (Reuters) – Short sellers have ratcheted up bets against private credit firm Blue Owl Capital, with short interest standing at all-time highs at a time when the private lending industry has been hammered by liquidity and credit quality concerns.
About 14.1% of Blue Owl’s free float shares were shorted, up from nearly 12.5% two-weeks ago, data analytics firm Ortex said.
Shares of the New York-based company were rocked in February after it said it would sell $1.4 billion of assets from three of its credit funds so it can return capital to investors and pay down debt, and permanently halted redemptions at one of the funds.
Earlier this week, Blackstone’s flagship private credit fund faced a surge in withdrawals in the first quarter, with clients pulling a bigger than usual $3.7 billion from the $82 billion fund, known as BCRED.
Concerns have grown over liquidity and valuation in the industry, as elevated redemption requests in some semi-liquid funds have put the spotlight on how managers meet withdrawals and fund distributions.
Shares of alternative asset managers, including Blackstone, Ares Management and KKR, have also clocked sharp declines of late.
Short interest for alternative asset manager Apollo Global Management also stood at 5.9% of its free float and has been elevated since December, Ortex said.
Blue Owl Capital has financed large digital infrastructure projects, including a roughly $27 billion joint venture with Meta to build the Hyperion data center campus in Louisiana, with funds it manages taking an 80% stake, while Meta retains about 20% and leases back the facilities.
This type of financing deal reflects how major data center operators like Meta are tapping private capital to fund sprawling AI infrastructure build-outs.
Blue Owl shares were up 1.5% on Thursday, though still down more than 30% for the year so far.
(Reporting by Shashwat Chauhan and Akash Sriram in Bengaluru; Editing by Shinjini Ganguli)
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