Apollo Global Management Inc. Chief Executive Officer Marc Rowan is putting up $431 million of the company’s stock, and could end up selling it, as he looks to access some of his wealth tied to the firm. Entities affiliated with Rowan entered into a so-called prepaid variable forward contract for 2.5 million shares, or about 7% of his holding in the company, according to a regulatory filing on Monday. The slug of stock represents less than 0.5% of Apollo’s total outstanding. The contracts essentially putting a future sale in motion can help participants access cash while putting off a tax liability and preserving their voting rights until the deals are complete. The arrangements typically give shareholders most of their money up front and may include terms letting a participant avert the sale by settling in cash.
Rowan, 62, is monetizing some of his shares as Apollo joins the S&P 500, the world’s most-watched equity gauge. That presented “a unique time to enter into the contracts given the expected increase in trading volumes following such announcement,” the company said in the filing. Rowan “has no current intention to sell the remaining company shares beneficially owned by him and has entered into a one-year lock-up agreement covering all such company shares,” it said.
Rowan helped co-found Apollo 34 years ago and took over as CEO in 2021, ushering in an era of relative stability and prosperity after a tumultuous power struggle. During his tenure, assets have soared to $733 billion, and its stock has more than tripled. It touched a record high on Friday as it joined the index. Abstaining from sales in the past few years, he now ranks as the fourth-largest Apollo shareholder, with a stake of about 6% that’s worth almost $6 billion, according to data compiled by Bloomberg. That excludes his stakes in Apollo’s funds. Altogether, he commands an $11.3 billion fortune, according to the Bloomberg Billionaires Index.
Apollo is looking to gather $25 billion of capital for the fund, which is expected to launch early next year, according to people with knowledge of the matter, who asked not to be identified discussing private information. At $25 billion, Apollo’s 11th fund dedicated to private equity would be the largest yet, after the asset manager fell short of the same target last year and raised just under that in 2017. A representative for Apollo declined to comment on specific funds. Private equity firms are looking to raise record fund volumes as the market for initial public offerings and a lower rates trajectory is expected to give the industry a much-needed boost next year.
Deal-making has suffered in recent years as distributions to investors slowed and the cost of financing soared, but some are already noting increased investor interest to the asset class ahead of some of the mammoth fundraising ambitions. Some of these firms are also starting to exit more of their investments. In the third quarter, Apollo said it had seen “sizable monetizations,” or sales, within its flagship private equity funds which led to its realized performance fees reaching their highest level since 2021. Apollo’s private equity business, led by David Sambur and Matt Nord, closed its 10th fund at around $20 billion, and has deployed more than half of that so far. The firm has signed deals for acquisitions including gambling machines company Everi Holdings Inc, Travel Corp., package-delivery company Evri and chemical company Univar Solutions.
