Apollo nears deal for 10% Mubadala Capital stake

Investing giant Apollo Global Management is finalizing a deal to buy nearly a 10% stake in Mubadala Capital, the alternative asset manager subsidiary of Abu Dhabi’s sovereign wealth fund, Mubadala Investment Company, according to people familiar with the matter who spoke on condition of anonymity. 

The deal is expected to be announced later Monday morning, they said. Financial terms were not immediately known.

The transaction is significant on multiple fronts. It further advances Apollo’s ambitions in Abu Dhabi, often called the “capital of capital.” The firm has spent the past 15 years building key strategic relationships there, with both the country’s investment arm and its core leadership.  

Apollo already has a multibillion-dollar partnership with Mubadala Investment Company, first established in 2022 and extended two years ago. At the time of that extension, Apollo said the agreement would strengthen the firm’s Capital Solutions platform by enabling the firms to jointly source and provide customized debt and equity financing to companies worldwide.

In 2023, the institutions formed a $2.5 billion joint venture designed specifically to co-invest in global private credit opportunities over a five-year horizon.  

For Mubadala Capital specifically — the region’s only large-scale asset manager, advising and administering over $755 billion in assets — the deal further advances its growth strategy under the direction of CEO Hani Barhoush, and its relevance on the global investing stage. It also marks an inflection point for the company’s core alternatives business, which has grown to more than $60 billion.

John Zito, co-president of Apollo’s Asset Management arm, and Barhoush have worked closely together over the past several years and, according to sources, their close-knit relationship and the success of prior partnerships led to talks of deepening ties. So did the belief that scale in the asset management business matters more than ever. 

“Capital as a moat is a big thing,” said one person familiar with the deal.

Importantly, the deal also continues a notable shift in the relationship between American investment firms and the Middle East. While the region, and Abu Dhabi specifically, has long been a sought-after source of capital, this deal further reverses that dynamic, with Apollo making a significant direct investment in the country and its investment vision.

Mubadala Capital’s international offices include London, New York, Rio de Janeiro and San Francisco.

Apollo’s investment in Mubadala Capital is similar to deals the firm has done with other asset management platforms, including Diameter Capital, Thoreau, Motive Partners and others.

Spokespersons for both firms declined to comment.