Bespoke private investment grade debt structures corporate capital
The guest argued that private investment grade (IG) debt offers large corporate issuers a flexible, bespoke alternative to rigid public bond markets and expensive equity.
The argument
The speaker explained that while public bond markets offer the lowest cost of capital, they lack structural flexibility. Private IG allows for creative structuring, such as partial or full equity treatment or issuing at subsidiaries, for only a couple hundred basis points of premium.
The thesis, stress-tested
✓ What validates it
- ✓Increased origination volume of private IG deals on Apollo's balance sheet
▸ Risks discussed
- ▸Higher cost of capital compared to public bond markets
Hear it yourself
"The second one was what I would call private IG. Private IG may sound like an oxymoron, but private IG is going to big blue chip corporate issuers and saying, we know you can access the public bond market, and that's gonna be your lowest cost capital to go raise money to do whatever it is you need to do."
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