Apollo Global Management Inc said on Monday it will merge with Athene Holding Ltd in an $11 billion all-stock deal, bringing in-house an annuities provider that helped turn it into one of the world’s largest corporate credit investors. Apollo has been getting paid lucrative fees by Athene, in which it controls a 35% stake, for more than a decade, providing asset allocation services and directly managing a portion of Athene’s assets across its investment platform, primarily in its ever-expanding credit business.

Apollo estimated the tax-free combination could result in its earnings more than doubling from 2020. Its existing stake in Athene did not contribute to earnings under accounting rules, despite representing 40% of Apollo’s assets under management and 30% of its fee-related income.

A merger would allow Athene’s business and assets to be integrated into Apollo’s, providing both sides with enhanced earnings potential and a simpler ownership structure going forward, Marc Rowan, Apollo’s incoming chief executive officer, told an analysts call.


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Source: Reuters

Reporting by David French and Chibuike Oguh in New York and Noor Zainab Hussain in Bengaluru; Editing by Jonathan Oatis and Matthew Lewis