Blue Owl Capital Corporation II (OBDC II) 10-Q: NAV $4.25 at Sep 30, 2026, No Buybacks, $4.16 Returned

Which Blue Owl fund is this?

Blue Owl runs several credit vehicles with near-identical names. OBDC II is a private-style fund that sold shares to individuals in a continuous public offering that ended April 30, 2021, and has no exchange listing. Its adviser is Blue Owl Credit Advisors LLC. It is a different company from the listed Blue Owl Capital Corporation (NYSE: OBDC, a separate CIK), whose dividend and non-accruals we cover on that page, and from the non-traded Blue Owl Credit Income Corp, whose tender results are in our OCIC redemptions page. The background to the 2025 merger agreement that was called off and the February 2026 loan sale is in our earlier page, OBDC II return of capital, which this page does not repeat. This page is the new filing: the September 2026 10-Q and what changed since June. The full list of such funds is in our non-traded BDC list.

What the October 20, 2026 8-K says

The only filing between the August and November 10-Qs on this CIK is the 8-K dated October 20, 2026 (Items 8.01, Other Events, and 9.01, Financial Statements and Exhibits). Its body is one paragraph: on October 15, 2026 the Board declared a return of capital of $0.62 a share to all shareholders “for the fourth quarter”, equal to 7.5% of the December 31, 2025 NAV, payable on or before October 21 to holders of record on October 20. It adds that, with this payment and the earlier ones, the company “will have returned 50.3% of December 31, 2025 NAV, totaling $4.16 per share in the last seven months”. Exhibit 99.1 is a shareholder letter dated October 20, 2026. The 8-K contains no merger, listing, asset sale or tender offer. The 10-Q confirms the payment was “funded by proceeds from ordinary-course portfolio repayment activity”.

At 115,645,897 shares, $0.62 is about $71.7 million (our arithmetic), the same as the July payment.

NAV per share, 2023 to 2026

NAV drifted down about 2 to 3 cents a quarter for two years, then fell by cash leaving the fund, not mainly by loan losses.

From December 2023 to December 2025 NAV fell 73 cents, 8.1% (our arithmetic), while shares fell from 140.3 million to 114.9 million through tenders. In 2026 the fund returned $3.54 a share of capital through September, and NAV fell $4.02 (48.6%). The 10-Q's financial highlights show where it went: net investment income $0.22 a share, realized and unrealized losses $0.37, so a decrease of $0.15 from operations; distributions of $0.22 from income and $3.54 of return of capital, and a $0.12 line for “distributions in excess of” net investment income and realized gains; the net change in NAV was $(4.03). The company reports a total return of minus 1.8% for the nine months (it assumes reinvestment under the dividend plan until it ended). In the third quarter itself, net unrealized loss was $17.9 million, offset by $16.9 million of net realized gain.

The portfolio itself got smaller, not necessarily worse: investments at fair value went from $1,576.6 million (December 31, 2025) to $691.0 million (June 30) to $597.2 million (September 30), and the number of portfolio companies from 183 to 154 to 145. Third-quarter gross originations were $22.5 million (par), against $130.2 million a year earlier. Over nine months the fund took in $951.4 million of repayments and selldowns and funded $30.3 million of new investments.

Repurchases: seven tenders, all filled, then none

Until September 2025, OBDC II offered each quarter to buy back a fixed dollar amount of shares at a price close to NAV. The final amendment to each Schedule TO gives the result:

Three things stand out. First, no tender was ever prorated: when requests exceeded the offer (March 2024, June 2025, September 2025) the company used the 2% extra allowance under Rule 13e-4(f)(1)(ii) to buy everything. Second, requests doubled: 3.45 million shares in June 2024 to 7.07 million in September 2025, 2.05 times (our arithmetic). Third, the seven offers cost $312.6 million for 35.7 million shares (our arithmetic). The 10-Q's share table shows what happened after: nothing repurchased in the third quarter of 2026, against 7,138,809 shares and $60.3 million in the third quarter of 2025, and 17,598,030 shares and $151.0 million in the first nine months of 2025. The 10-Q also reports that no unregistered equity securities were sold in the quarter, and that the Board ended the dividend reinvestment plan on February 17, 2026, so all future distributions are paid in cash.

So a request for “OBDC II repurchase results” has a short answer: the last one was September 2025. The way out since March 2026 is the returns of capital below.

Distributions against income

The 10-Q's table totals $3.8749 a share and $448.1 million for the nine months, of which $3.54 is return of capital. The comparison with income:

(Last column is our arithmetic.) Third-quarter total investment income was $16.8 million against $46.2 million, down 63.6%; interest expense fell 81.4% to $3.0 million, so net investment income after taxes fell 42.6%, less than income. Two items sit under the headline: an income-tax benefit of $1,656 thousand in the quarter lifted after-tax NII, and the realized gain line carries $8,394 thousand of realized income-tax expense. Before taxes, third-quarter NII covered 90% of the regular distributions. At the new rate of $0.022 a month ($0.264 a year, our arithmetic) the regular dividend is 7.3% of a $3.63 NAV, before any change in earnings. The 10-Q says the company expects to make monthly cash dividends “from the Company's net investment income” and that, subject to the Board, it “may return 5% or more of our then-prevailing NAV” each quarter, citing historical repayments of 6 to 8% a quarter.

Non-accruals: our tally from the schedule of investments

The 10-Q does not publish a non-accrual total. It marks each non-accrual line in the schedule of investments with a footnote: “(28) Investment was on non-accrual status as of September 30, 2026”. We summed every line carrying that footnote, in the September 10-Q (for September 30 and December 31, 2025) and the June 10-Q:

(Shares are our arithmetic on total investments of $1,576.6, $691.0 and $597.2 million at fair value and $1,604.4, $739.5 and $670.3 million at cost.) The fair-value share rose even though the dollar amount fell, because repayments shrank the denominator by 62% since December. The cost-based share is the sharper signal: non-accrual cost went from 3.1% to 10.4% of what the fund paid. At September 30, 2026:

Loparex first carries the footnote in the June 10-Q; it was not flagged at March 31 or December 31, 2025. Walker Edison Furniture and EOS Finco, both flagged at December 31, 2025, no longer carry the footnote at September 30, 2026. The company's own words on credit are less alarming than the cost-based figure: “Generally we are not seeing a meaningful increase in amendment activity, requests for increased revolver borrowings, missed payments or other signs of an overall, broad deterioration” in results of the portfolio companies, with the caveat that “there can be no assurance” this continues. Both statements can be true: the fund has sold the broad book of performing loans, and what is left contains a larger share of the loans it had already marked down.

Leverage: from 0.65x to 0.22x

At September 30 the debt was $128.5 million drawn on the SPV Asset Facility I ($200.0 million commitment) and nothing on the $75.0 million Revolving Credit Facility, with $102.2 million available, subject to borrowing bases. Gross debt over net assets is 0.26x (our arithmetic: $128.5 million over $491.2 million). Cash including foreign cash was $21.2 million. The 1940 Act floor is 200% asset coverage; at 481% the fund has headroom, and the October return of capital (about $71.7 million) is funded from repayments, not borrowing. The weighted average total yield of the portfolio at fair value was 9.9% and the weighted average spread of floating-rate debt 6.0%; 77.5% of the portfolio by fair value is first-lien senior secured debt (71.0% at June 30; 77.4% at December 31, 2025).

Fees paid to the Adviser

The management fee is 1.50% a year of average gross assets excluding cash, measured at the last two calendar quarter-ends, so it follows the shrinking balance sheet with a lag. Waivers were $14 thousand in nine months. The incentive fee on income is zero in 2026; the 10-Q describes a 1.5% quarterly preferred return and an upper breakpoint of 1.818%, with a 17.5% fee on cumulative realized capital gains. The nine-month total of $13.1 million is 17.1% of nine-month investment income of $76.6 million (23.3% a year earlier), our arithmetic. Payables to affiliates were $4.4 million at September 30. The ratio of net expenses to average net assets was 10.3% annualized for the nine months, interest included.

What the filing says about a liquidity event

The 10-Q repeats the fund's stated plan: the Board expected to contemplate a liquidity event “three to four years after the completion of the continuous public offering”, which ended April 30, 2021; that can be a listing, a merger, or a sale of assets followed by liquidation, and a merger or asset sale needs shareholder approval. It also says: “If the Company has not consummated a liquidity event by the five-year anniversary of the completion of the offering, the Board will consider” liquidating the company, subject to approvals. That anniversary was April 30, 2026, and the filing announces no liquidity event beyond the returns of capital. The practical liquidation path so far is the one the fund is already on.

What a reader can do with this

• If you hold OBDC II: there is no tender to join. Your cash comes from declared distributions on every share. Use $4.25 (September 30 NAV) as the last filed value, and $3.63 as our arithmetic for after the October payment, and expect the next 10-K (for 2026) to carry December 31 figures.
• If you get a secondary bid: compare it with about $3.63, not with the $8.27 you may remember, and check whether the next record date falls before or after the sale. Our census of Cox Capital's tender offers covers the earlier third-party bids for this fund.
• Taxes: the 10-Q does not give the tax character of the 2026 returns of capital. Ask for the year-end Form 1099-DIV before assuming how the payments are taxed; see estimated tax payments for REIT, BDC and K-1 income and 1099-DIV due dates for non-traded vehicles.
• What would change the picture: a non-accrual total above the current 10.4% of cost, a drop in the monthly dividend below $0.022, a skipped quarterly return of capital, or a merger or listing filing.

If a large share of your savings is in one wind-down fund with no tender and a falling NAV, it may be worth a conversation with a qualified adviser about how the position fits the rest of your holdings.

FAQ

All figures are from SEC EDGAR filings of Blue Owl Capital Corporation II (CIK 1655887) read on November 7, 2026: the Forms 10-Q for September 30, 2026 (accession 0001655887-26-000025), June 30 (0001655887-26-000016) and March 31, 2026 (0001655887-26-000013) and for 2024 and 2025; the 2025 Form 10-K (0001655887-26-000010); the Form 8-K of October 20, 2026 (0001655887-26-000021); and the final Schedule TO-I amendments of March 2024 to September 2025. The last filing on this CIK was the Form 10-Q of November 6, 2026. Ratios, sums, percentages and the non-accrual tally are our arithmetic. This is analysis of public documents, not investment, legal or tax advice.