Apollo Special Situations fund holds close

The fund, which targets longer-dated private market opportunities that don’t fit in its flagship fund, is nearing the halfway mark toward its $750m target.

Apollo Global Management is nearly halfway through fundraising for its Apollo Special Situations Fund, which focuses on longer-dated private market investment opportunities, PDI sister publication Private Equity International reports.

The firm has held a second close on $360 million, according to a regulatory filing with the Securities and Exchange Commission from Friday. 

Apollo launched the fund at the beginning of last year, targeting $750 million in total commitments, and held a first close on $250 million in the first quarter, according to co-founder Josh Harris, speaking during the firm’s first-quarter earnings call in May.

“This fund is a product expansion within private equity that will seek to capture idea generation across the platform and invested opportunities that we believe are attractive, but typically fall outside existing fund mandates,” he said. “Samples of investments that we expect to make through this special situations fund could be longer-dated private equity, royalties, infrastructure and minority investments.”

The firm released more information in its 2016 10K filed with the SEC last month regarding the strategy of the fund, saying that it relies on a “flexible investment approach to pursue opportunities up and down the capital structure, including opportunities that may result from market dislocation, regulatory change or out of favour industries”.

“We believe these special situations investments represent a sizeable and scalable investment opportunity to capture structurally downside-protected opportunities,” it wrote. While SSF is distinct from previous Apollo funds, we believe the Fund is a natural extension of Apollo’s private equity business and will benefit from Apollo’s integrated platform.”

Leon Black, also co-founder of Apollo, explained during the same conference call in May that the firm plans to spend the first fund quickly and to go back to LPs for more capital. In August, the fund invested in Nike’s apparel supply chain in the Americas as part of a partnership with the company to formulate a new supply chain model, according to a joint statement from Apollo and Nike. It acquired two supply-chain businesses as part of the transaction.