Global asset management firm Apollo (NYSE: APO) has agreed to purchase the U.S. wealth distribution and asset management businesses of Griffin Capital, a privately-held alternative investment manager headquartered in Los Angeles, California with more than $5 billion in assets under management. Financial terms were not disclosed.
Apollo said that the acquisition is a “significant step” in building its Global Wealth Management Solutions business, which focuses on developing and distributing alternative investments to individuals and their wealth advisors.
Since 1995, Griffin Capital has sponsored or co-sponsored a number of alternative investment products including non-traded real estate investment trusts, interval funds, and tax advantaged strategies, including Delaware statutory trusts and opportunity zone funds.
“Griffin has built trusted relationships over 20-plus years, and in combination with Apollo can offer the market a broader set of solutions,” said Marc Rowan, Apollo’s chief executive officer.
Griffin’s approximately 60 client-facing distribution professionals are currently established in the independent channel, which Apollo said is a “complement” to its focus on private banks, wirehouses, registered investment advisors, and family offices. Apollo intends to integrate the Griffin team into its Global Wealth business, noting that the acquisition also adds “valuable technology, infrastructure and hundreds of distribution agreements to its…platform.”
Randy Anderson, Ph.D. and CEO of Griffin Capital Asset Management, will join Apollo’s real estate team as part of the acquisition.
“The world of alternative investments is vast and competitive, and partnering with a world-class asset manager like Apollo is a logical step in the growth and evolution of Griffin,” said Kevin Shields, chairman and CEO of Griffin Capital. “Apollo is committed to building its Global Wealth business, and they have the resources to foster growth of our existing interval fund business and bring creative, new alternative solutions to individual investors.”
Apollo has been building its pipeline of alternative products for individual investors. Last month, it launched a non-traded perpetual-life business development company, Apollo Debt Solutions BDC, with a global bank platform and expects to continue the launch with multiple banks and independent channel partners into next year.
The all-stock transaction with Griffin is Apollo’s largest investment in Global Wealth to-date. Apollo said that the transaction is expected to be approximately breakeven to its after-tax distributable earnings per share of Class A common stock in 2022, and a meaningful driver of earnings and growth from its Global Wealth business in the years ahead.
Shares of Apollo stock closed at $71.80 on Thursday, up $1.15 or 1.63 percent from the previous close.
The transaction is expected to close by the first half of 2022 and must be approved by stockholders of Griffin Institutional Access Real Estate Fund and the Griffin Institutional Access Credit Fund.