Firms & Funds

Apollo Fund VIII reaches $18.4 bln with $900 mln from insiders

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  • LPs from outside U.S. comprise 55 percent of fund
  • Apollo takes aim at carve-outs, European deals
  • Insiders contribute about 5 percent of Fund VIII capital

Apollo Global Management added the nearly $1 billion from insiders to the $17.5 billion raised from outside investors in its fourth-quarter financial statement released on Feb. 7. The contribution from Apollo and its affiliates amounts to about five percent of the total amount raised for Fund VIII.

With this war chest, Apollo is taking aim at deals in Europe and smaller businesses within bigger conglomerates, Martin Kelly, chief financial officer, said on the firm’s conference call with analysts.

“Clearly in this environment, we’re focused on corporate carve-outs but not limited to that, so we’ll continue to be very flexible and search for idiosyncratic opportunities in a very classic Apollo way, and I think that’s what LPs are thinking about when they trust us with their capital,” Kelly said.

Apollo said the restructuring of the financial services sector in Europe is creating “compelling investment opportunities and we are in the early stages”. The firm remains “well-positioned to capitalize on the significant opportunities to acquire attractive assets and businesses” in the region.

Apollo said Fund VIII reflects a move toward increasing allocations to alternatives by LPs and the consolidation of GP relationships “among branded, scale players with outstanding long-term track records.”

Investors representing more than 90 percent of Fund VII’s capital also took part in Fund VIII, according to the firm.

About 25 percent of Fund VIII third-party commitments, representing more than $4 billion of capital, came from investors that are new to Apollo.

Apollo also said that 55 percent of the $17.5 billion in capital raised for Fund VIII came from non-US LPs, up from 22 percent in its vintage 2001 Fund V.

All told, Apollo grew its assets under management to $161.2 billion in 2013 from $113.4 billion in 2012. Much of that increase came from its life insurance unit Athene Holding Ltd’s acquisition of Aviva USA, which boosted AUM by $44 billion in its credit segment.