Apollo Management is reportedly set to become the second big US buyout firm to list on the public market.
Apollo has appointed JP Morgan and Goldman Sachs to weigh up an initial public offering, according to media reports. It follows the recent announcement by rival US firm The Blackstone Group that it plans to raise up to $4 billion (€3.0 billion) by listing a portion of its management company on the New York Stock Exchange.
Blackstone’s move in turn followed a successful IPO by US-based alternative asset manager Fortress Investment Group, which raised $635 million through a listing on the New York exchange and has since seen its share price rise by nearly 60 percent.
Columbia Business School finance professor Matthew Rhodes-Kropf told Bloomberg: “We’re going to see a cascade of these as long as they keep working. It’s not going to be a surprise when we start seeing announcement after announcement.’’
It would not be the first time that Apollo has followed one of its rivals to raise additional capital through the public markets. Last July, it became the second firm – after Kohlberg Kravis Roberts – to float a buyout fund on the Euronext exchange in Amsterdam. However, after KKR’s vehicle exceeded expectations to raise $5 billion, Apollo struggled to hit its $2.5 billion hard cap and ended up raising about $1.5 billion. Shares in the vehicle recently rebounded to the $20 issue price, although they have been mostly trading at a discount since the listing.
The firm, which is run by chief executive Leon Black, is currently investing from its sixth conventional buyout fund, which closed at $12 billion in January 2006. Last month it agreed to pay £1 billion for UK estate agency Countrywide, following an earlier $6.6 billion deal for US real estate group Realogy, and also concluded a $3.1 billion deal for US retailer Claire’s Accessories.