Apollo Management, the buyout firm run by billionaire Leon Black, is seeking about $1.5 billion in an initial public offering for a private equity fund, three people with direct knowledge of the situation said.
Apollo is following Kohlberg Kravis Roberts & Co., the world's largest buyout firm, which raised $5 billion three weeks ago in an IPO for a similar fund. New York-based Apollo will use proceeds from its offering to finance takeovers and buy stocks and bonds, said the sources, who declined to be identified before plans about the sale are officially disclosed.
Buyout firms, including Blackstone Group and Carlyle Group, are considering similarly structured investment vehicles. By selling shares in funds, the firms can gain more firepower to complete bigger deals.
"I would be shocked if many other firms weren't doing the same," said Kevin Albert, a New York-based partner at buyout firm Elevation Partners.