Apollo Buys Bridge Investment Group in $1.5B All-Stock Deal

Private equity giant Apollo Global Management has purchased Bridge Investment Group, a real estate investment firm with $50 billion in assets, in a $1.5 billion all-stock transaction. 

The deal values Bridge Investment Group at roughly $11.50 per share, roughly a 45 percent premium over the $8.14 the firm traded at late Friday afternoon. Prices of Bridge shares increased by nearly 34 percent Monday morning once the deal became public, and are currently trading at $10.56. 

The deal will be finalized in the third quarter. 

David Sambur, an Apollo partner and co-head of equity, said the deal is “highly aligned” with Apollo’s desire to expand its real estate originations base, adding that Bridge’s clients and investment strategy are expected to match well with Apollo’s real estate credit platform.  

“Bridge brings a seasoned team with deep expertise and a strong track record in their sectors,” said Sambur. “Their business will complement and further augment our existing real estate capabilities, and we believe we can help scale Bridge’s products by leveraging the breadth of our integrated platform.”

Based in Salt Lake City and founded in 2009, Bridge Investment Group specializes in residential and industrial CRE investments, with a client base that encompasses institutional investors and high-net-worth individuals. The firm employs more than 300 investment professionals. 

Under the new marriage, Bridge Executive Chairman Robert Morse will move into Apollo as head of the firm’s real estate equity division, while Bridge will remain an independent real estate investment platform within Apollo’s asset management strategies business. 

“We are proud to be joining Apollo and its industry-leading team, who share our commitment to performance and excellence,” said Morse in a statement. “This transaction will allow the Bridge and Apollo teams to grow on the strong foundation that Bridge has built since 2009 as we work to pursue meaningful value and impact for our investors and communities.”

The deal has generated immediate and positive buzz in the investment community. 

Neal Epstein, vice president of Moody’s Ratings Private Credit Group, said in a statement that Apollo’s purchase of Bridge “aligns with its strategic objectives,” and that Apollo is acquiring a firm with more than $22 billion in fee-paying assets under management, and with particularly “strong capabilities in residential real estate equity.”

“The acquisition of Bridge will further a number of Apollo’s strategic objectives, including growing its global wealth business, and expanding its alternative management capabilities in real estate,” said Epstein. 

“The all-equity acquisition will have minimal leveraging impact on Apollo, which also continues to build its balance sheet’s liquid resources,” he added. 

Bank of America Securities, Citigroup, Goldman Sachs, Morgan Stanley and Newmark acted as financial advisers on the deal. 

Brian Pascus can be reached at bpascus@commercialobserver.com