Apollo's Zito on Fears Facing Private Credit Investors

Summary

Apollo's John Zito discusses how the current high volatility regime, driven by the early stage of a technology platform shift, makes credit a safer investment due to its senior position in the capital structure. He also emphasizes the importance of sector-specific factors such as asset intensity, customer control, and capital strength in determining company valuations.

• John Zito characterizes the current market as a high volatility regime due to technological platform shifts.
• He argues that credit is safer than equity in this environment because it is senior in the capital structure.
• Zito notes that services companies will face lower transaction multiples.
• He highlights the importance of asset heaviness, customer control, and capital availability for company protection.
• There is a potential shift in value from labor to capital, which could be disruptive for investors.
• Zito believes the market is not fully acknowledging credit's safety amid the acknowledged volatility.