Bloomberg News

Apollo Partners to Get Part of Incentive Income in Stock

July 07, 2014

Apollo Global Management LLC (APO:US) partners will receive part of their cut of profits from the firm’s latest private-equity pool in Apollo stock.

The change, disclosed in a July 3 filing with the U.S. Securities and Exchange Commission, applies to the 27 partners in Apollo’s private-equity group and excludes co-founders Leon Black, Joshua Harris and Marc Rowan.

The buyout and credit manager, which is based in New York and led by billionaire Black, said in a May earnings call that it planned to revamp compensation to better align its partners’ incentives with those of its public shareholders. Most private-equity firms claim 20 percent of deal profits as an incentive, and publicly traded managers such as Apollo typically pay out much of that money in dividends and supplemental cash compensation to partners and employees.

Under the new plan, the team overseeing the $18.4 billion private-equity fund the firm completed raising in January will use some of their incentive income to buy restricted shares of Apollo that vest over three years. The filing didn’t specify how much.

The three founders, who together own almost 50 percent of the company, will continue to take their cut of earnings solely in stock dividends. Last year, their combined payout from dividends topped $800 million, according to financial filings.

Apollo oversaw more than $159 billion in private-equity investments, credit assets and real estate as of March 31.

To contact the reporter on this story: David Carey in New York at dcarey13@bloomberg.net

To contact the editors responsible for this story: Christian Baumgaertel at cbaumgaertel@bloomberg.net Josh Friedman, Mary Romano


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Companies Mentioned

  • APO
    (Apollo Global Management LLC)
    • $24.44 USD
    • -0.55
    • -2.25%
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