Apollo Global Management Inc. is launching a big new credit operation as the buyout giant dives deeper into the rapidly expanding pool of direct lending, the Wall Street Journal reported. The New York firm is creating a $12 billion platform focused on providing companies with loans of around $1 billion, Apollo officials said. Abu Dhabi state fund Mubadala Investment Co. is the lead backer of the venture, whose firepower Apollo plans to augment with additional capital from other investors. In direct lending, an alternative credit provider makes a loan and keeps it on its books rather than syndicating it out to investors. Direct lending has expanded dramatically since the financial crisis as new regulations and a desire to avoid the mistakes of the past push banks to eschew riskier businesses. That has left a void for private capital to fill, creating a market Apollo and others estimate at roughly $800 billion — up from around $100 billion a decade ago.
