Apollo Management IPO: Apollo Private Equity IPO

It’s a shock plan from the buyout firm in US. Apollo Management, yesterday, filed for an Initial Public Offering or IPO with the Securities and Exchange Commission.
Market Analyst say this is a bit of shocking surprise, as the global markets are in a melting and highly volatile state, Apollo coming out with an IPO at these times is a bit strange.

The stock market don’t seem to have any hunger for the new issues. Most of the issues in the past have seen loss making weak listing. Issues like Pogo Jet IPO were even cancelled (Read Pogo Jet IPO review). Many more SEC filing by various companies are cancelled due to turbulent market timings.

However, Apollo, the private equity investment Company, seems to take the bull by its horns in a head on collision. The Apollo Management is listed on a private exchange run by Goldman Sachs. It has now applied for transferring a significant share of its stock to the public markets by filing to sell 29.8 million existing shares on the NYSE or New York Stock Exchange.

The major investments for Apollo so far has been in the UK based Intelsat, the satellite operator. There are no plans to get any new additional money from the IPO. Instead, the IPO will make it easier for Apollo’s beleaguered shareholders to sell their shares.

As of now, the Apollo shares on the private exchange of Goldman Sachs are trading at the price of $14 per share, which is a clear loss of 40 % compared to the initial price of $24-per-share, as demand from the kind of institutions and wealthy investors that trade on the private Goldman exchange has plunged. The good thing for the shareholders is that now they can trade on the open and regulated market like NYSE with much more liquidity and the IPO price will also be higher than the $14 current price.

Though there are no signs from the markets to make a comeback, hence the market experts say it is a difficult time when Apollo Private Equity has decided to go for the IPO. A typical example is that of Blackstone which has suffered losses to the tune of 50% of the offer price since its trading commenced on the NYSE last June.
In a filing to the Securities and Exchange Commission, Apollo hinted that it may use its public listing to raise additional capital in the future.

Let’s see how this special IPO from Apollo Management of Private Equity performs.

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