Apollo Loans Carry Premium of About One Percentage Point, Research Paper Says

MT Newswires Live09-09 01:19

Apollo Global Management (APO) loans carry a premium of about one percentage point, according to a research paper published Tuesday by US academics Vince Buccola of the University of Chicago and Greg Nini of Drexel University.

The higher loan charges are due to Apollo's reputation for "aggressive treatment of lenders," the authors wrote in the paper titled "The Sponsor Premium".

The results of the study correspond with the opinions of many credit investors and investment bankers about a so-called "Apollo premium" that has existed over the past two decades, according to a Financial Times report Tuesday.

In an emailed statement to MT Newswires, Apollo called the study "flawed". "As the paper's own data shows, Apollo portfolio company borrowers carry lower leverage and tighter documentation than comparable borrowers, leading to strong outcomes for lenders and equity investors alike," the company said.

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