Well, more than a year later, Dyal at last owns a piece of an NBA franchise, and one that’s three games away from winning its first-ever title, no less. But it has no plans to stop there, nor even where it originally planned to stop, impropriety, consanguinity and conflicts of interest be damned.

Dyal HomeCourt Partners is purchasing less than 5% of the [Phoenix Suns] and may acquire more over time…. Dyal is raising capital from investors to expand its HomeCourt fund after striking a deal with the NBA last year to take stakes across the league’s 30 teams….

“We’re going to start with something like a 5% stake and look to grow it over time,” Laurino said of the Suns deal as well as the firm’s plans for future acquisitions. Dyal can seek to expand its NBA holdings to as much as 20% per team, according to [Dyal managing director Drew] Laurino.

And why not? It’s not like professional sports franchises are even pretending to compete with one another anymore.

Dyal Buys Stake in Phoenix Suns, Valuing Team at $1.55 Billion [Bloomberg]

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.

Massive Merger Spurns Fight Over Wall Street Secrets
Imagine your favorite sports team being forced to hand over its playbook to a bitter rival. That would irk any sports fan.

Now imagine a similar scenario, but it’s Wall Street insiders being forced to hand over their precious trade secrets.

That exact fact pattern is unfolding due to a proposed merger between Dyal Capital and publicly traded Owl Rock Capital — a deal that has spawned multiple feisty lawsuits.

“We Honor Our Deals”
Let us set the stage: Dyal Capital, a division of asset manager Neuberger Berman, specializes in buying minority stakes in other private investment companies. A bit like nesting dolls.

In recent years Dyal has acquired stakes in firms including Golub and Sixth Street Partners, two players in the private lending space.

Now Dyal is merging with Owl Rock Capital, another financier specializing in private lending — a deal that would create a $12.5 billion investment behemoth.

The Rub: Golub and Sixth Street are concerned that Dyal — which has access to sensitive information about their operations and some amount of internal influence — will quickly morph from an investor and partner into a competitor:

• In a recent New York State Supreme Court filing, Golub said, “Dyal threatens to compete with Golub while retaining a partnership interest in it," claiming the merger was “untenable and forbidden” under the terms of its deal.
• Sixth Street Partners has filed to block the merger in Delaware state court, arguing it sold a stake “on the fundamental understanding that Dyal would act as a partner — not a competitor.”

For its part, Dyal has attempted to downplay concerns, claiming it has “crafted a robust and comprehensive information control policy designed to restrict access to confidential partner manager information.”

The Icing On The Cake: The tie-up of Dyal and Owl Rock is wrapped up in another Wall Street fad. The pairs merger is being backed by a SPAC called Altimar Acquisition Corp.

The Takeaway: There has never been a more lucrative time to be a Wall Street lawyer.

Securing a deal, therefore, requires a bit of creativity, and have Dyal Capital Partners, Owl Rock Capital Partners and HPS Investment Partners ever done so with this extraordinary circle-jerk: In essence, an asset manager that invests in hedge-fund stakes (Dyal) is simultaneously spinning off from its owner (Neuberger Berman) by merging with a SPAC backed by a hedge fund (HPS) that is partially owned by said asset manager, and merging with a second hedge fund (Owl Rock) that is also owns a chunk of, in which Frankestein’s monster the former parent will remain a major investor. Makes total sense, right?

Dyal and Owl Rock said they have been discussing a deal with a special-purpose acquisition company called Altimar Acquisition Corp.

The Wall Street Journal earlier reported on the transaction, which would value the combined asset managers at about $13 billion, according to people familiar with the matter….

Dyal has previously floated the idea of an IPO of one or more of its funds as a possible way to allow its investors the option of monetizing their holdings, the Journal has reported. The transaction being discussed, however, is an IPO of the management company and wouldn’t alter the liquidity opportunities for fund investors.

Of course: Who would want to undertake a complicated financial transaction to benefit them? And who says SPACs are just back-slapping masturbatory nonsense that will end in tears?

Dyal Capital in Talks to Combine With Owl Rock Capital [WSJ]
Ex-Barclays investment bank chairman plans to raise $250 million with blank-check company [MarketWatch]
Australia’s Macquarie to buy Waddell & Reed Financial for $1.7 billion [Reuters via CNBC]

David DiDomenico, a Jana co-portfolio manager for the past decade, is now also chief executive officer of Osprey Technology Acquisition Corp. Osprey, which recently raised $275 million in an initial public offering, said it would rely on DiDomenico as it sought takeovers in the enterprise software industry.

The value of Dyal’s investment in Jana was redacted from the lawsuit, but Dyal implied it had paid a large sum for the stake and said it “did not want them to take that money and run.” DiDomenico’s departure from the hedge fund firm would “spell disaster for Jana’s future,” according to the lawsuit. Yet DiDomenico admitted to Dyal that his new venture had taken him “‘outside the Jana box,’” Dyal claims.

Dyal apparently started to get a bit fiddly last year when Jana shut two of its flagship hedge funds, especially since the firm’s overall assets have dropped by more than three-quarters since its 2015 investment. Dyal says it only allowed those liquidations to go through on the understanding that DiDomenico would “keep working full-time at Jana,” which he rather patently isn’t anymore, and so wants its money back, please.

Jana, for its part, says it’s all much ado about nothing: Jana, after all, owns about half of Osprey, and so DiDomenico’s running of it is just a different way of working at Jana full-time. Anyway, it’s not like other successful hedge fund managers aren’t able to remain so while dividing their attention. Steve Cohen assured his investors that he’d be able to keep doing what he does while also turning the Mets around, which he now won’t get to put into practice but which is probably true, since the Mets would be improved by just 10 minutes a month of competence in place of decades of active mismanagement. Ken Griffin remains the sausage king of Chicago while spending the majority of his time scanning real-estate listings. And however much time DiDomenico and Rosenstein spend on Jana’s activist fund certainly seems like enough, given that it rose by more than half last year.

Dyal Sues Rosenstein’s Jana Over Divided Attention at Fund [Bloomberg]