Ontario pension group commits to Apollo fund series

The Investment Management Corporation of Ontario (IMCO) committed C$250 million to Apollo Global Management, its first investment with the global private equity giant. The allocation was to Apollo’s Accord Fund III Series B, which is a fund designed to enter the market during periods of dislocation and illiquidity. The strategy is focused on credit investments that have traded down due to liquidity-driven selling and non-economic reasons. The investment is housed in the C$70 billion (US$50 billion) fund’s recently launched C$2 billion global credit program. It was set aside as a separate asset class to provide higher risk-adjusted returns than traditional fixed income and to contribute to additional diversification benefits, according to team, which manages public sector employee pension assets. Apollo's fundamentals-approach and sector-specific expertise allows for selective deployment during periods of both market stability and volatility, in line with IMCO's global credit strategy. The Accord Fund’s judicious use of hedges, designed to address fundamental risks, is well suited for IMCO's long investment horizon, officials said. “Our participation in this fund demonstrates how nimble our team can be in seeking valuable opportunities for our clients,” said Jennifer Hartviksen, managing director of global credit at IMCO. The process of allocating to Apollo on April 23 took approximately one month from analysis to fund close. Harviksen described the investment as an example of IMCO adapting to market conditions and exploiting its liquidity to pub money to work in dislocated opportunities as they arise. “As our program scales, we are initially relying on experienced strategic partners," said Christian Hensley, senior managing director, private equities and credit. "The investment in this fund is an example of the types of opportunities we're pursuing -- investments with sponsors that we believe have deep expertise, delivering diversifying and differentiating exposures, who are transparent, opportunistic, and value-oriented."

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