Apollo Global Management Announces Pricing for New Notes Offering

Apollo Global Management Sets Pricing for Note Offering

Apollo Global Management, Inc. (NYSE: APO) has recently announced the successful pricing of its offering of $500 million in Fixed-Rate Resettable Junior Subordinated Notes due in 2054. This noteworthy financial move marks a significant step for the company, enhancing their ability to manage outstanding debts and invest in future projects.

Details of the Fixed-Rate Resettable Notes

The newly issued notes will carry a fixed interest rate of 6.000% annually until the first reset date on December 15, 2034. After this period, the interest rate will be adjusted to reflect the five-year U.S. Treasury rate, plus a margin of 2.168%. This mechanism is designed to allow Apollo to remain flexible with its financial strategy while still providing investors with a competitive yield.

Interest Payment Schedule

Interest payments on these notes will occur semi-annually, specifically on June 15 and December 15 of each year, with the first payment commencing on June 15, 2025. This predictable schedule is crucial for investors seeking steady income from their investments.

Utilization of Proceeds

The anticipated net proceeds from this offering are about $495 million after accounting for underwriting expenses. Apollo Global Management plans to deploy these funds for various corporate purposes, including fully redeeming the outstanding $300 million of its 4.950% Fixed-Rate Resettable Subordinated Notes due 2050. This strategic move not only simplifies Apollo's debt structure but also potentially reduces interest expenses overall.

Management and Underwriters of the Offering

A consortium of leading financial institutions is managing the offering. J.P. Morgan Securities LLC, BofA Securities, Inc., Citigroup Global Markets Inc., and Goldman Sachs & Co. LLC are the primary book-running managers. Additional firms such as Academy Securities, Inc. and U.S. Bancorp Investments, Inc. are also involved in supporting the offering.

Regulatory Compliance

This offering is conducted under an effective shelf registration statement with the U.S. Securities and Exchange Commission (SEC). All investors should be aware that the offering is subject to customary closing conditions.

What This Means for Apollo

The pricing of these notes is viewed as a strong indication of Apollo’s financial health and market confidence in their management strategy. The structured payments and use of funds signal a proactive approach to managing liabilities while also laying the groundwork for future investments and growth opportunities. Investors are likely to keep a close eye on Apollo's performance as they navigate this critical juncture.

Frequently Asked Questions

What are Fixed-Rate Resettable Junior Subordinated Notes?

These notes are a form of debt instrument that offers a fixed interest rate for a specified period, after which the rate may reset based on market conditions.

What is the purpose of the capital raised from this offering?

Apollo intends to use the proceeds from the offering for general corporate purposes, notably to redeem existing subordinated notes and to manage outstanding debt effectively.

When will the first interest payment be made?

The first interest payment on the new notes will be made on June 15, 2025.

Who is managing the offering?

The offering is being managed by a collection of major financial institutions, including J.P. Morgan and Goldman Sachs.

How does the interest rate reset affect investors?

The interest rate reset allows investors to benefit from potential increases in the U.S. Treasury rate, providing an opportunity for more competitive returns as market conditions change.

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