New Issue: Apollo prices upsized $1.25 billion 6.75% mandatory convertible preferreds, up 20%

By Abigail W. Adams

Portland, Me., Aug. 9 – Apollo Global Management Inc. priced an upsized $1.25 billion of three-year $50-par series A mandatory convertible preferred stock (Baa1/BBB/BBB) after the market close on Tuesday at par at the midpoint of talk with a dividend of 6.75% and a threshold appreciation premium of 20%, according to a market source and an FWP filing with the Securities and Exchange Commission.

Price talk was for a dividend of 6.5% to 7% and a threshold appreciation premium of 17.5% to 22.5%.

Goldman Sachs & Co. LLC (lead left), Morgan Stanley & Co. LLC and Wells Fargo Securities LLC are bookrunners for the SEC registered offering, which carries an upsized greenshoe of $187.5 million.

The initial size of the offering was $1 billion with a greenshoe of $150 million.

The notes have takeover and dividend protection above 43 cents a quarter.

They will be listed for trade on the New York Stock Exchange under the ticker “APO.PRA.”

Proceeds will be used to accelerate growth of the company’s retirement services segment conducted by subsidiary Athene Holding Ltd.

Depending on market conditions, after pricing the offering of the mandatory convertible preferred stock, Apollo may conduct a subordinated debt financing transaction to redeem the Apollo Asset Management, Inc. outstanding preferred stock.

The mandatory convertible preferred stock will be junior to any such additional debt securities with respect to dividend rights and distribution rights upon liquidation, winding-up and dissolution.

Apollo is a New York-based private equity firm.

Issuer:	Apollo Global Management Inc.
Securities:	Series A mandatory convertible preferred stock
Amount:	$1.25 billion
Greenshoe:	$187.5 million
Maturity:	July 31, 2026
Bookrunners:	Goldman Sachs & Co. LLC (lead left), Morgan Stanley & Co. LLC and Wells Fargo Securities LLC
Bookrunners:	Barclays Capital Inc., Citigroup Global Markets Inc., J.P. Morgan Securities LLC, UBS Securities LLC, RBC Capital Markets, LLC and Apollo Global Securities, LLC
Co-managers:	Academy Securities, Inc., Blaylock Van, LLC, BMO Capital Markets Corp., BNP Paribas Securities Corp., BofA Securities, Inc., Drexel Hamilton, LLC, Mizuho Securities USA LLC, MUFG Securities Americas Inc., Siebert Williams Shank & Co., LLC, SMBC Nikko Securities America, Inc., SG Americas Securities, LLC, U.S. Bancorp Investments, Inc.
Counsel to issuer:	Paul, Weiss, Rifkind, Wharton & Garrison LLP and Walkers (Cayman) LLP, Cayman Islands
Counsel to underwriter:	Simpson Thacher & Bartlett LLP
Dividend:	6.75%
Price:	Par of $50.00
Yield:	6.75%
Threshold appreciation premium:	20%
Threshold appreciation price:	$98.97
Conversion rate:	Minimum of 0.5052, maximum of 0.6062
Call options:	None
Put options:	Upon a fundamental change
Pricing date:	Aug. 8
Settlement date:	Aug. 11
Distribution:	Registered
Talk:	Dividend of 6.5% to 7% and a threshold appreciation premium of 17.5% to 22.5%
Stock symbol:	NYSE: APO
Stock price:	$82.48 at market close Aug. 8
Market capitalization:	$49.49 billion

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