Owl Rock Capital — which lends money directly to U.S. middle market companies — has hired Oaktree Capital Management’s Jesse Huff to help lead a new opportunistic strategy.
Owl Rock is looking to raise about $1.5 billion to finance companies hit by the pandemic and economic shutdown, according to someone familiar with the lender.
Huff will be co-head with Nicole Drapkin, who has been with Owl Rock since its founding five years ago.
Owl Rock managed $17.3 billion as of March 31.
The firm has been working on the new strategy for a year, the source said. Prior to the pandemic, Owl Rock felt that about 20 percent of the 5,000 companies it has reviewed in five years would fit a more opportunistic strategy than it offered.
Post-pandemic, Owl Rock estimates that about 30 to 40 percent of $2 trillion in private equity portfolio companies face meaningful uncertainty.
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The founders — Doug Ostrover, co-founder of Blackstone Group’s GSO Capital Partners; Marc Lipschultz, KKR’s ex-energy and infrastructure head; and Craig Packer, former co-head of leveraged finance for the Americas at Goldman Sachs — started Owl Rock in 2016.
Owl Rock initially raised $5.5 billion from institutional investors including Brown University. Neuberger Berman’s Dyal Capital Partners took a stake in Owl Rock last year.
Opportunistic strategy co-heads Drapkin and Huff have a long history in credit. Drapkin, a former principal at the Canada Pension Plan Investment Board, helped build Owl Rock’s investment process. Huff led distressed debt trading and sourcing at the Carlyle Group before joining Oaktree.