Regional Q&A: Apollo Asia-Pacific with Matt Michelini

In a recent Q&A, Partner and Head of Asia-Pacific Matt Michelini discussed Apollo’s growth across the region, key trends impacting the investment landscape, and what he enjoys most about the job.

Apollo has operated and invested in opportunities across Asia-Pacific for over 15 years. Matt Michelini, Partner and Head of Asia-Pacific, recently took time to discuss the firm’s growth and business strategy, where the team is seeing investment opportunities today, and his favorite parts of living in the region.

Could you describe the growth Apollo has experienced in Asia-Pacific in recent years?

As background, Asia-Pacific has been, and continues to be, a key strategic priority for the firm. We have an established platform with a successful, 15+ year track record of delivering solutions across private equity, real estate and credit. Moreover, we have a tenured team, with many of our Investment Professionals having over 20 years of experience investing in the region. Today, Asia-Pacific represents one of the largest and fastest growing hubs for Apollo globally, with 500+ employees across our 8 regional offices (with headquarters in Singapore).

Last year was an exciting year for us – while we’ve continued to scale our existing businesses in the region, we’ve also prioritized expanding in new areas, in line with key growth drivers we’ve identified. As an example, we launched our Global Wealth business in the region, which Edward Moon and his 2-person team started from scratch last year. They raised $1.5 billion in capital, which represented 25% of the total Global Wealth amount raised for Apollo – a tremendous achievement. Moreover, we force multiplied our origination capabilities and deployed over $2.5 billion in 2022.

"It is especially exciting to see our Asia-Pacific teams build connectivity with our US and European businesses. Our global partners are increasingly allocating capital into Asia-Pacific, and it is clear that there is growing demand from our global pools of capital for Asia-Pacific risk."

Matt Michelini, Partner and Head of Asia-Pacific

Further, the India real estate team has really carved out a nice segment of the market where they are finding what is, in our view, mispriced risk-reward. As my colleague Madhura Shah, Head of Infrastructure, India, recently shared, our NESCO office in India has been great in terms of supporting the build-out of our Asia-Pacific business more broadly, and continues to offer Apollo high-quality talent all located in one office. And the introduction of Apollo’s Capital Solutions capabilities in the region is already starting to bear fruit with our investors. 

We also announced a number of key strategic insurance and re-insurance partnerships in the region, and we’re now focused on scaling Atlas SP, Apollo’s recently launched securitized credit origination platform, in Asia-Pacific as we look to accelerate growth in the asset-based finance markets out of Australia.

What are the key trends impacting the Asia-Pacific investment landscape today? How is your team addressing them?

First, I’ll point out that much of developed Asia-Pacific has a large, aging population in need of retirement solutions. Unlike in other regions, many of these retirees do not have a sufficient safety net for their retirement savings and investments, so they’re looking for new, diversified investment options that can help provide them with long-term security. On the flip side of this, much of Asia-Pacific also has a younger generation that is eager to invest.

On the financing side, the trend of traditional bank retrenchment from various lending activities persists in Asia-Pacific as it does in other parts of the world. This has created a significant opportunity for us to prop up our own credit ecosystem and help to close existing financing gaps. We’ve had success so far in providing Asian companies with large-scale, differentiated, cross-capital-structure solutions. I think we’ll only see more growth in this area as this trend continues.

Overall, as we do in any geography, we abide by our guiding principle that “purchase price matters” when it comes to deploying capital. As part of this we maintain patience and discipline even when markets are risk-on and growth-heavy, meaning that we’re able to find more opportunities to selectively invest in volatile markets such as the one Asia-Pacific is experiencing now. On the Hybrid Value front especially, we expect we’ll be able to find compelling ways to deploy capital amidst this dislocation.

Last year, Apollo launched a dedicated Asia-Pacific Credit Strategy with Hostplus. How has this strategy come to life in recent months?

As background, last year we announced the launch of our $1.25bn Asia-Pacific Credit strategy, to which Hostplus, one of the largest superannuation funds in Australia, committed a $500mn anchor investment. The focus here is to capitalize on growing demand for private credit in the region across the risk-reward spectrum. Since the launch we’ve continued to build out a great team, and have already deployed a meaningful amount of capital.

We know you’re all settled in Singapore now after having made the move there in 2021. What has been your favorite part about living in the region and running Apollo Asia-Pacific?

Luckily, my transition was made incredibly smooth by so many people at Apollo. My favorite part about the work here would have to be the tight-knit culture in our Asia-Pacific offices, and the caliber of talented individuals around me that I can learn from each day. Everyone has a different background here, but it all comes together in an unexpected but beautiful way.

From a personal perspective, I love learning more about the rich and unique histories of each country in the region. On the whole, everyone has been incredibly welcoming, and it was exciting to settle my family here in Singapore. Although, some days it still feels like I’m not quite used to the island weather!

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