Business Solution

Apollo wins ADIA backing for $4bn secondary solutions business

Apollo announced the formal launch of its Sponsor and Secondary Solutions business, S3, which aims to provide what it calls “flexible capital solutions” to asset managers and limited partners across the yield, hybrid and equity spectrum.

The $697 billion Abu Dhabi Investment Authority (ADIA) is backing the new entity in making a cornerstone commitment to S3. In total the business has raised $4 billion, including affiliated capital. The deal underscores the rapid growth of the secondary market and lending overall.

“As private capital markets continue to grow, mature and evolve, so too do the need of market participants,” said Apollo Co-Presidents Scott Kleinman and Jim Zelter in a statement. “We believe Apollo is well positioned to provide a holistic suite of flexible, expedient solutions across this landscape.”

Apollo, with $513 billion in overall assets, has already been highly active in secondaries to-date, committing or deploying more than $13 billion of capital to transactions of this nature over the last 12 months. With the launch of S3, Apollo establishes a dedicated, client-oriented business for these solutions, with operational protocols that provide additional information safeguards, officials said.

The formation of S3 builds on recent transactions such as a $5.1 billion NAV loan to Softbank Group, which is estimated to be one of the largest-ever private fund financing deals. Additionally, Apollo was involved in Behrman Capital’s $500 million continuation fund for Micross Components.

The S3 team includes the recent hires of BlackRock executives Veena Isaac, Steve Lessar and Konnin Tam as partners to co-lead hybrid and equity secondary solutions.

Isaac joined from BlackRock, where she was a managing director overseeing secondary solutions. Prior to that she was a partner at Jasper Ridge and a principal at Patheon Ventures. Lessar also joins from BlackRock, where he also was a managing director within secondary solutions. Prior to joining BlackRock, he handled private equity secondaries at Goldman Sachs. Meanwhile, Tam was co-head of secondary solutions at BlackRock. Previously, he was a managing director of the private equity investment team at Goldman Sachs.

In 2021, Olga Kosters joined Apollo as a managing director focused on credit secondary solutions, and Jasen Yang joined as a managing director focused on fund finance and other structured lending solutions. Kosters joined from Tikehau, where she was the head of private debt secondaries, while Yang was head of credit structuring at BNP Paribas.

Apollo wins ADIA backing for $4bn secondary solutions business

You may also like