Apollo to Convert $6B Convertible Debt and Acquire 90M Morpho Tokens
Apollo intends to convert $6.0 billion of convertible bonds into equity, reducing debt but potentially diluting shareholders. It says $49.0 billion in Bitcoin holdings can cover debt if BTC drops to $8,000 and has agreed to acquire 90 million Morpho tokens (9% supply) over four years to support on-chain lending.
1. Convertible Bond Conversion Plan
Apollo Global Management announced plans to convert $6.0 billion of outstanding convertible bond debt into equity. This move is designed to lower balance sheet leverage but will increase the number of shares outstanding, potentially diluting existing shareholders depending on conversion rates and market price at conversion.
2. Bitcoin Holdings Coverage
The firm highlighted its $49.0 billion Bitcoin portfolio, stating it can withstand a price drop to $8,000 per BTC while still fully covering the converted debt. This assertion aims to reassure investors on the security of debt obligations despite crypto volatility.
3. Morpho Token Acquisition Partnership
Apollo has partnered with Morpho in an agreement to acquire up to 90 million MORPHO tokens, representing 9% of the total token supply, over the next four years. The collaboration is intended to support expansion of Morpho’s on-chain lending infrastructure, though specific deployment plans remain undisclosed.