Apollo Global profits $250 million from xAI debt investment — Bloomberg

LootboxPhobia · 2026-02-27T22:38:25+00:00

Apollo Global Management Inc. profits approximately $250 million from investing in Elon Musk's xAI, having purchased $7 billion worth of xAI debt to gain access to Nvidia graphics processors. In December last year, Apollo bought the debt at 99 cents and recorded a book profit, further benefiting from transferring the debt to other institutions.

LootboxPhobia

2026-02-27 22:38:25

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Investing.com - According to Bloomberg, citing sources, Apollo Global Management Inc. (NYSE: APO) has realized approximately $250 million in paper gains from its investment supporting Elon Musk’s xAI. The alternative asset manager has invested $7 billion in xAI debt as part of an agreement that grants the AI startup access to Nvidia Corp. (NASDAQ: NVDA) graphics processors.

Sources say Apollo purchased about $3.5 billion of xAI debt at 99 cents on the dollar in December. These loans carry a 10% coupon rate. After the announcement of the merger with Musk’s SpaceX on February 3, the value of these debts increased to 106 cents.

Sources also indicate that Apollo distributed about half of the debt purchased in December at 99 cents to clients, while retaining the rest, which generated approximately $120 million in paper profits. After buying an additional $3.5 billion in loans in February, the company also gained $100 million in paper gains as the trading prices of these loans increased. Apollo transferred some of the debt to insurance companies and asset managers at the issuance price of 99 cents.

The company has opened trading of xAI debt purchased earlier this year. Apollo has been working to distribute private credit more broadly by establishing a market platform and collaborating with banks to provide real-time pricing. Last year, Apollo traded nearly $10 billion in high-grade private loans.

All debt provided by Apollo for xAI is designated for a special purpose entity managed by Valor Equity Partners, to help the startup lease chips for its Colossus 2 data center site in Memphis.

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