Credit Suisse MDs picked-off by Apollo, but Mizuho is being mentioned
It's happening. As Credit Suisse prepares to sell its securitized product group (SPG) to Apollo Global Management, key people are being invited to move across. But there are suggestions that some people may still move to Mizuho instead.
Mizuho was said to be interested in Credit Suisse's SPG unit in October. In November, though, Credit Suisse announced that it had agreed to sell, 'a significant part of its Securitized Products Group (SPG) and other related financing businesses,' to Apollo instead. Mizuho appeared to have dropped out. In fact, it's been lurking on the sidelines, considering buying the bits Apollo doesn't want.
Multiple sources at Credit Suisse tell us that Jay Kim, the global head of securitized products at Credit Suisse, has told his team that he'll be leading the new company formed by Apollo. Managing directors in some parts of the Credit Suisse SPG team are already being asked to move across with him. However, insiders say people in secondary securitized product sales and trading are less likely to be wanted by the Apollo NewCo; they may be asked to move to Mizuho instead.
"Apollo want the people working on the primary deals and are less interested in secondary sales and trading," says one insider. "To the extent that they do want salespeople, it's the people working with the big new issue buyers of asset backed securities and non agency deals that they're interested in."
Credit Suisse declined to comment. In an October investor call, Apollo said its interest in securitization is more limited than in a typical bank. "For the most part, a bank wants the client. They can sell the client payments and FX, hedging and M&A and equity and a whole range of services that we and our peers are not really equipped, nor do I believe we will be equipped to offer. What we want is the asset..."
Credit Suisse managing directors who are being asked to move to Apollo are reportedly being offered sweeteners like equity to persuade them to commit. "Based on who and who doesn’t accept offers, they will go down the line and make offers to directors and VPs," says a source.
Those who don't get the Apollo offers could move to Mizuho. Or not. Insiders say a lot of people are likely to look for new jobs instead. Some, like James Gray in London, have already resigned.
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