(Bloomberg) — Apollo Global Management Inc. debuted a division to oversee four businesses aimed at capturing the trillions of dollars up for grabs from individuals and striking more partnerships with traditional asset managers.
The unit — called New Markets — will be led by 17-year Apollo veteran Neil Mehta, who was most recently head of strategy. Mehta will oversee the four business lines, including traditional asset management, defined contribution, tax-advantaged solutions and digital markets, according to a staff memo.
Apollo Chief Executive Officer Marc Rowan and President Jim Zelter said in the memo that few new areas offer as much promise as these. Apollo has pegged the potential pool of assets it could tap across the four business lines in the $60 trillion range, with about $40 trillion in actively managed public assets and roughly $20 trillion in defined-contribution plans.
Alternative asset firms have been angling to get a piece of individual investors’ wealth, a largely untapped resource, as institutions such as endowments and pensions curb allocations to private assets or have hit their limits on such investments. Many have been collaborating with traditional asset managers to debut new products specifically for the retail segment.
Apollo has partnered with State Street Corp. on a private-credit ETF and Lord Abbett on an investment-grade credit interval fund, which typically offers investors a chance to redeem some of their investments every quarter. Apollo’s new division will aim to strike more partnerships with traditional money managers.
Alternative asset managers have also been ramping up their efforts to push higher fee-paying alternative assets into US retirement savings and beyond public bonds and equity, arguing that workers are missing out on upside delivered by private investments. Apollo also recently worked with State Street on a strategy for defined-contribution plans that includes private and public markets.
Apollo’s Andrew Gosden will oversee traditional asset management for the New Markets group. Steve Ulian will lead defined contribution, working with Sean Brennan and Rebecca Tadikonda at Apollo’s Athene unit. John Hillman will manage the tax-advantaged solutions line, and digital markets will be led by Christine Moy.