Apollo Global Management (NYSE:APO) has traded more than $35 billion in private credit assets since the firm launched its private credit trading desk earlier this month.
John Cortese, partner and co-head of corporate credit at Apollo, told Bloomberg that the private credit desk has traded approximately 500 assets with 160 counterparties. Approximately one-third of that volume involved loans originated by other firms.
Apollo Pushes Into Private-Credit Trading
Apollo began rolling out daily marks across its approximately $850 billion credit business this month. The trading activity comes as Apollo looks to bring greater liquidity and price transparency to private credit, a market that has historically relied on quarterly valuations.
"It’s inevitable that you’re going to need all pockets of capital to look at this opportunity. And that also means liquidity. A large amount of investors are used to seeing transparency in what they own," said Cortese.
This comes as the SEC released a statement last week urging firms and auditors to take a closer look at how they value private assets and disclose the risks behind those valuations.
The SEC specifically warned managers not to treat limited borrower information as a reason to ease up on valuations.
“Lack of timely borrower information does not relieve management of its responsibility to estimate fair value,” the SEC staff said.
Instead, managers should consider information beyond an individual borrower, including changes in credit spreads, liquidity conditions and the compensation investors are demanding for risk.
Cortese told Bloomberg that greater transparency and liquidity would ultimately benefit private credit, helping the asset class expand, and argued that liquidity should be viewed as a strength rather than a weakness.
Space Exploration Technologies Corp. (NASDAQ:SPCX) is reportedly planning to raise $40 billion in bank loans and investment-grade debt, led by Apollo, to buy Nvidia Corp. (NASDAQ:NVDA) chips.
Large companies are increasingly seeking private-credit solutions to finance complex projects, particularly AI infrastructure and chip development, Cortese said, adding that he expects that activity to grow.
Apollo is expected to lead the deal and help place the debt with a broad range of investors, with Pimco among a small group of lenders in talks to provide financing. The transaction is expected to close in 2027.
Photo: Image by Piotr Swat via Shutterstock
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