(Bloomberg) -- Apollo Global Management Inc. aims to raise at least $6 billion for a strategy that provides financing that sits between debt and equity, according to people familiar with the matter.

This will be its third Hybrid Value Fund.

Apollo’s $13 billion Hybrid Value business, co-headed by Rob Ruberton and Jason Scheir, offers investors higher returns — and risk — than traditional forms of debt while stopping short of full company buyouts, according to the firm’s website. The strategy gained 15.4% last year.  

A spokesperson for Apollo declined to comment.

New York-based Apollo raised $4.6 billion in 2022 for its previous hybrid value fund. The unit has provided financing for companies including Albertsons Cos Inc., Expedia Group Inc. and Direct ChassisLink Inc.

Chief Executive Officer Marc Rowan said on its fourth-quarter earnings call that Apollo needed to originate more hybrid investments to meet anticipated investor demand. The firm had $62 billion overall in hybrid assets at year-end. 

“If we want to play a role in allowing high-net-worth investors and institutional investors to pivot out of active management of equity, I believe they’re going to pivot into hybrid,” he said. 

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