My crinkly brain has been stuck on this song Please, Release Me (1949) made popular by Engelbert Humperdinck in 1967 (look up Izzard’s skit about workshopping that artist name).
It gets weirder because the earworm was brought to me by an owl, specifically Blue Owl Capital, which provides private capital solutions (for example, credit) to businesses.
Back in November 2025, FT broke a story that Blue Owl had closed one of its earliest private credit funds to redemptions while it merged the fund with another, larger and riskier credit vehicle.
Let me just back that up a bit. A private credit fund is an investment fund that lends to businesses. Some private credit funds, like Blue Owl’s original, allow investors to withdraw/redeem (some of) their funds at certain times at the stated fair value of the fund. That can make the fund more attractive to retail investors, especially because their money is not locked in for years. But it can also be risky if too many pull/redeem their money at the same time—a sort of run on the fund.
On top of that, some private credit funds, like the one Blue Owl tried to merge with, are publicly traded, and the price of shares fluctuates depending on how the market values the credit quality of the fund’s loan portfolio.
What Blue Owl asked its investors to do was halt their redemptions and exchange their share amount in the original fund for an equal share amount in the larger fund. Only, the larger fund shares were at that point trading at 80% of the stated fair value.
In other words, investors stood to potentially lose 20% of their asset value by making the exchange, and with little option but to go along.
That led to strongly worded comments. Blue Owl did not go through with the merger of the funds and went back to allowing the redemptions of up to 5% of net assets every quarter.
That is, at least, until things went sideways in February. A fear emerged that old-school software and software-as-a-service companies were on the brink of extinction because of AI. That caused major ripples into private credit, since a lot of the debt financing for said companies comes from there. Investors got scared and requested redemptions, and we were back to Engelbert Humperdinck’s crooning.
This time, Blue Owl said no more redemptions at all and moved to wind down the original fund. Other big private credit funds were hit, too, and the concern is ongoing and seems to keep building on itself.
Again, most fund investors get into private credit because it carries risk. As Apollo Global Management’s (another private credit provider) CEO, Marc Rowan, said to Bloomberg last week:
“People made choices: If you wanted a higher dividend, you could take more risk […] That felt really good on the way up. That’s not going to feel so good on the way down.”
FRG and The Risk Report find private credit interesting because it affects the financial infrastructure we work within.
Regitze Ladekarl, FRM, is FRG’s Director of Company Intelligence. She has 25-plus years of experience where finance meets technology.
This article is part of the FRG Risk Report, published weekly on the FRG blog. To read other entries of the Risk Report, visit frgrisk.com/category/risk-report/.