CS to Sell Most of SPG to Apollo/PIMCO
"Credit Suisse has entered into a framework and exclusivity agreement to transfer a significant portion of itsSecuritized Products Group (SPG) to an investor group led by Apollo Global Management. Under the terms ofthe proposed transaction, investment vehicles managed by affiliates of Apollo and PIMCO would acquire themajority of SPG's assets from Credit Suisse and other related financing businesses from Credit Suisse, enter intoan investment management agreement to manage the residual assets on Credit Suisse's behalf, hire the SPGteam to the new platform and receive certain ongoing services from Credit Suisse in order to maintain a seamlesshigh-touch experience for clients."
Thoughts on this? Curious to see how the two firms will divide up the group. Anyone have any insights into what will happen to offers?
Too early to tell. The deal was literally down to the wire (between Centerbridge and APO/PIMCO) - Jay (who heads the team) probably is learning about this as it came out of Zurich.APO/ Pimco haven’t traditionally had a securitized products business so it makes sense to buy one and build it out.Speculating here, but I think it'll go as a "new co" backed by the consortium + minority holding by CS. Where that leaves balance sheet (and therefore cost of funds) to price deals (and beat hurdles) is the question.Sexy part of it, is that the team would be able to invest down the cap stack (instead of just sitting on senior like most banks) - which is how PC funds make more money.The SPG business is a gorilla in the SP space and the team is big. It's one of the most respected teams on the street. I think it'll be alright for an incoming SA. You're coming straight into the Private Credit world - which arguably where you would want to end up anyway….Either way, there more certainty in SPG than say CSFB which god knows how the IB teams play out... my opinions (so I could be wrong)
https://www.efinancialcareers.com/news/2022/10/credit-suisse-securitize…
Here you go… if you’re incoming. You’re fine
Interested
Sounds like something APO has done before and has been doing for a while now (even going back to 08/09) of just taking on businesses that were formerly done by bigger banks
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