Key Takeaways
- • Apollo Global Management plans to spend approximately $350 million over the next 24 months to build daily valuations, standard identifiers (CUSIPs), market making, and custody and settlement infrastructure for private assets, according to CEO Marc Rowan on the firm's Nov. 3 third-quarter earnings call.
- • Rowan said the goal is to make buying and selling private assets "as easy and familiar as possible," beginning with credit in 2027, with further timelines and deadlines to follow.
- • Apollo implemented an estimated daily value for its entire credit business at the end of September, using structured credit product AMPAS as a model for the broader plan.
- • Apollo's assets under management reached $1.07 trillion in the third quarter, up 18% year-over-year, with $53 billion of inflows including $35 billion from asset management and $19 billion from retirement services.
- • Apollo reported record origination of $114 billion in the quarter, alongside a net loss of $1 billion attributed to debt markdowns.
Summary
Apollo Global Management outlined a plan to spend about $350 million over the next 24 months to make private assets more liquid, transparent and tradable. Speaking on the firm's Nov. 3 third-quarter earnings call, CEO Marc Rowan said the initiative would add daily values, standard identifiers, market making, and custody and settlement for private assets. "The world I'm describing is a world in which private assets have a price, they have a CUSIP, they're tradable, and custody and settlement (takes place) without the need for expensive intermediated structures," Rowan said. Custody and settlement will be handled in partnership with other firms.
Rowan said the investor base for private markets has broadened beyond traditional institutions to include individuals, insurance companies, traditional asset managers, 401(k) plans and defined contribution plans. He argued these new buyers have operated in public markets and do not want the same products as earlier institutional clients, so firms need to "go to them." Apollo said it has already implemented an estimated daily value for its entire credit business as of the end of September, and pointed to Apollo Multi-Asset Prime Securities (AMPAS) as an example of the approach. Rowan said the plan would involve writing off existing software and systems to adopt new technologies faster, and that new businesses would be built primarily out of the firm's Austin, Texas, office.
The announcement follows several recent moves by Apollo. The firm agreed to acquire a minority equity stake in Abu Dhabi-based Mubadala Capital, which has $60 billion in assets, and on Nov. 2 launched European Credit Company, a platform focused on European performing credit with €10 billion ($11.2 billion) of lending capacity, according to a press release. Per an earnings presentation, Apollo's assets under management grew to $1.07 trillion in the third quarter, an 18% increase year-over-year. Inflows totaled $53 billion for the quarter, including $35 billion in asset management inflows, with strength in institutional and global wealth, and $19 billion in retirement services across retail and funding agreements. Origination reached a high of $114 billion, while the firm reported a net loss of $1 billion attributed to markdowns in debt.
Rowan said the investor base for private markets has broadened beyond traditional institutions to include individuals, insurance companies, traditional asset managers, 401(k) plans and defined contribution plans. He argued these new buyers have operated in public markets and do not want the same products as earlier institutional clients, so firms need to "go to them." Apollo said it has already implemented an estimated daily value for its entire credit business as of the end of September, and pointed to Apollo Multi-Asset Prime Securities (AMPAS) as an example of the approach. Rowan said the plan would involve writing off existing software and systems to adopt new technologies faster, and that new businesses would be built primarily out of the firm's Austin, Texas, office.
The announcement follows several recent moves by Apollo. The firm agreed to acquire a minority equity stake in Abu Dhabi-based Mubadala Capital, which has $60 billion in assets, and on Nov. 2 launched European Credit Company, a platform focused on European performing credit with €10 billion ($11.2 billion) of lending capacity, according to a press release. Per an earnings presentation, Apollo's assets under management grew to $1.07 trillion in the third quarter, an 18% increase year-over-year. Inflows totaled $53 billion for the quarter, including $35 billion in asset management inflows, with strength in institutional and global wealth, and $19 billion in retirement services across retail and funding agreements. Origination reached a high of $114 billion, while the firm reported a net loss of $1 billion attributed to markdowns in debt.
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