Bes Stocks To Buy 2014, Best Stocks For 2014: Apollo to Buy Stone Tower Capital, Adding $17 Billion in Credit Assets

Friday, January 6, 2012

Apollo to Buy Stone Tower Capital, Adding $17 Billion in Credit Assets

Apollo Global Management LLC, theprivate-equity firm started by Leon Black, agreed to buy StoneTower Capital LLC, adding $17 billion in credit assets andmaking capital markets its biggest business unit. Terms weren��tdisclosed.

Stone Tower, based in New York, invests in corporate loans,bonds and asset-backed securities for institutions such asgovernment and corporate pensions and university endowments. Thetransaction will bring Apollo��s assets under management to $82billion, of which $39 billion will be in capital markets, thefirm said today in a statement.

Private-equity companies are seeking to become morediversified asset managers after the financial crisis sappedinvestor appetite for leveraged buyouts. Blackstone Group LP (BX),the world��s largest private-equity firm, became the biggestmanager of collateralized loan obligations after buying Dublin-based Harbourmaster Capital Management Ltd. in October.Washington-based Carlyle Group, the second-largest private-equity firm, agreed in January to buy Dutch money managerAlpInvest Partners NV to expand its asset-management business.

��The strategic benefits are significant to our business,particularly amid the cyclical volatility and secular changeswhich we believe are creating voids in the marketplace that ourcombined platform can now effectively fill,�� James Zelter, headof Apollo��s capital markets business, said in the statement.

Apollo in July agreed to buy Gulf Stream Asset ManagementLLC, a Charlotte, North Carolina-based manager of corporate-credit assets. That acquisition added more than $3 billion ofassets under management to Apollo��s capital-markets business.

Shares Decline

Apollo fell 6.4 percent to close at $11.76 in New York. Thestock has declined 38 percent since its March 29 initial publicoffering, when Apollo sold shares at $19 each.

Michael Levitt, Stone Tower��s chief executive officer, willjoin Apollo as vice chairman of its credit management business,Apollo said in the statement. T! he firms expect to complete thetransaction in the first quarter.

Apollo today also agreed to buy Taminco Group Holdings, aBelgian chemical producer, from London-based private-equity firmCVC Capital Partners Ltd. for about 1.1 billion euros ($1.4billion).

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