Apollo Global Management (NYSE:APO) executives are in discussions for a potential sale of its $3 billion MidCap Financial Investment (MFIC) fund.
MFIC is a publicly listed business development company (BDC) focused on private credit. Apollo purchased MidCap in 2013 to boost its direct lending platform. The fund is expected to attract interest from rival BDCs, with a potential deal structure involving the acquirer offering shares of its own fund as consideration, according to a report seen by the Wall Street Journal.
The fund’s default rate climbed to 5.3% in the first quarter, up from 3.9% at the end of December, while management has spent part of the year buying back shares as they traded well below net asset value.
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