Apollo Follows Blackstone’s Lead?

CNBC is reporting that Apollo Management is working with Goldman Sachs on a possible IPO. The New York Times, on the other hand, says it’s all a bunch of hooey.

So who’s right? I don’t have a conclusive answer, except to say that I also had heard the “Apollo is meeting with Goldman” story, from a source who thought that the filing could hit SEC shelves within a week or two. The CNBC report does not discuss a filing date, except to say that the actual offering would likely occur this fall.

Both CNBC and my source suggest that Goldman’s involvement with Apollo helps explain why it was not part of The Blackstone Group’s extensive underwriting roster. No word on if other Blackstone-shunned banks like JP Morgan and Bank of America also are involved, or if they’re simply awaiting mandates from Carlyle, TPG and/or Oaktree. (Update: Reuters now reporting JPMorgan involved on Apollo deal)

Apollo raised $10.1 billion for its sixth buyout fund in 2005. According to limited partner CalSTRS (CalSTRS.pdf), the fund was just over 10% called down through the end of Q3 2006, with a -4.25% internal rate of return (note: IRRs are mostly irrelevant this early in a fund’s lifecycle). Apollo also manages a publicly-traded business development company (Nasdaq: AINV) that primarily makes mezzanine investments.