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Global Apollo Marc Rowan’s chief management says a wave of partnerships between alternative managers and large assets will shock Wall Street.
Rowan predicted that large private capital enterprises would increasingly distribute their investments, such as corporate purchases, to traditional assets managers who had prioritized their customers’ exposure to unregistered assets.
He said companies such as Apollo can create co-mark’s investment funds or “mass managed accounts” with traditional assets managers who would expand investors’ ownership for unmistakable assets.
“I see a very good marriage between our industry, our company and public or traditional assets managers, who I believe will recreate their businesses driven by competitive forces,” Rowan said while calling for Apollo’s fourth profits.
For the quarter, Apollo’s regulated net income increased 15 percent to $ 1,36BN from a year earlier.
Rowan said the purchase of the private manager of the private manager of HPS Investment partners and the infrastructure group Global infrastructure partners should be taken as a “awakening” call for the investment industry.
They megadeals signaled a need for traditional investment groups to provide private funds, which would lead to the biggest “convergence” among public and private investment portfolios, he said.
His comments come as the largest private capital groups of industry such as Apollo, Blackstone, KKR and Brookfield have depended on their growth to manage money for rich individual investors and, ultimately, ordinary pension savings.
Leaders predict that they will manage trillions of dollars for individual investors except $ 13 that the industry manages for institutions.
Traditional asset managers have prioritized investment in unregistered assets, which hold higher tariffs and higher diversification than public markets. These efforts come as tariffs for public funds fall and investors increasingly see public shares and bond portfolios as goods products.
“Our industry and our firm will be a supplier of products similar to traditional asset managers, as they seek to make their products more competitive given the extraordinary amount of indexation and correlation,” Rowan said.
Such partnerships between the two areas of finance that have been treated for decades as distinct markets reflect the increasing borrowing links between private capital groups and the wider banking system.
Since the fall of Silicon Valley Bank and Credit Suisse in 2023, private capital groups have formed companies of large banks, such as Citigroup and JPMORgan, which limited lending due to regulations and capital restrictions.
In these partnerships, private capital firms use their investor’s money to finance loans derived from large banks. They have also formed flow arrangements to distribute slices of loans they originate, selling pieces in large banks in search of higher -production assets.
In 2024, Apollo started a record of $ 220 billion in debt and has a dozen partnerships for debt distribution to large banks.
Rowan said the Trump administration would support bank regulations that had limited their lending businesses, reviving competition.
“Banks will be the strongest competitors in what we call direct lender or a small part of our private loan business,” Rowan said of irregular push. He also envisioned “an extraordinary consolidation of regional banking” during the Trump administration.
