Apollo divests Vallourec stake in €955 million deal
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NEW YORK – Apollo Global Management, Inc. (NYSE: NYSE:APO) has reached an agreement through its managed funds to sell a significant equity stake in Vallourec SA (Euronext: VK), a manufacturer of premium tubular steel products.
The transaction involves the sale of 65.2 million common equity shares, representing a 28.4% interest in Vallourec, to steel giant ArcelorMittal (NYSE:MT) at a price of €14.64 per share, totaling approximately €955 million.
This sale marks the Apollo-managed Funds’ exit from their investment in Vallourec and is expected to close in the second half of the year, pending customary closing conditions. Apollo Funds became the largest equity investor in Vallourec following the company’s financial restructuring in 2021.
During Apollo’s tenure, Vallourec underwent a significant transformation, launching the “New Vallourec” plan in May 2022, which revamped the company’s operational design and capabilities. This transformation led to a substantial increase in EBITDA, from €258 million in 2020 before Apollo Funds’ investment to €1,196 million in 2023, marking the company’s best results in nearly 15 years.
Apollo Partner Gareth Turner expressed pride in the strong results achieved and the company’s positioning as a leader in high-performance tubular products. He also noted Vallourec’s potential for future growth in energy transition markets and the appropriateness of transitioning their shareholding to an industrial partner like ArcelorMittal.
Vallourec’s Chairman and CEO, Philippe Guillemot, acknowledged Apollo’s crucial role in the company’s turnaround, highlighting the change in Vallourec’s operational and financial structure and the trajectory towards enhanced shareholder value.
Apollo is a global alternative asset manager with a focus on yield, hybrid, and equity investing strategies. As of December 31, 2023, the firm managed approximately $651 billion of assets. The information in this article is based on a press release statement from Apollo Global Management, Inc.
