Apollo Seeks $700 Million for CLO Firm as New Rules Loom

Leon Black’s Apollo Global Management LLC is raising $700 million for a new firm that will issue collateralized loan obligations, as part of its effort to comply with rules designed to curb excessive risk-taking by managers of the vehicles, according to two people with knowledge of the matter.

The new company will issue and manage CLOs compliant with the new rules, which require CLO managers to own a portion of their deals, the people said, asking not to be identified as the information isn’t public. Apollo itself will cease to issue any more CLOs after the new company is established, although it will continue to manage the funds it has already established, one of the people said.