ARI has entered into a definitive agreement to sell its commercial real estate loan portfolio, enabling a strategy refresh and validating book value per share.

Apollo Commercial Real Estate Finance, Inc. (“ARI” or the “Company”) (NYSE:ARI) today announced the Company has entered into a definitive agreement with Athene Holding Ltd. (“Athene”) to sell the Company’s entire approximately $9 billion commercial real estate loan portfolio for a purchase price based on 99.7% of total loan commitments, net of asset specific CECL reserves, and with the exception of two loans with a combined total principal balance of $146 million that are expected to be repaid prior to closing. Following repayment of ARI’s financing facilities and other indebtedness and transaction expenses, ARI expects to have approximately $1.4 billion of net cash and approximately $1.7 billion of common stockholders’ equity, which equates to approximately $12.05 per share of common stock.   ARI will retain all of the net equity interest in the real estate properties the Company holds, which totaled $466 million as of September 30, 2025.

Under the definitive agreement, Athene has the right to assign the right to acquire the assets to affiliates of and funds managed by Apollo Global Management, Inc. (together with its subsidiaries, “Apollo”) including Athene Co-Investment Reinsurance Affiliate entities. The transaction has been approved by ARI’s board of directors upon the unanimous recommendation of a special committee of independent directors of ARI’s board of directors. The transaction is subject to approval by the holders of a majority of the Company’s outstanding shares of common stock.

Stuart Rothstein, Chief Executive Officer and President of ARI said: “Our objective has always been and continues to be to maximize stockholder value. Like many peers in the sector, ARI’s common stock has traded below book value for an extended period and has not fully reflected the intrinsic value of the Company’s loan portfolio. At the same time, attractive yield-generating assets such as ARI’s are highly valued, in short supply, and continue to attract strong demand from the institutional market.   This transaction provides certainty of execution through a complete loan portfolio sale to a high-conviction buyer with deep familiarity with the assets, given Athene’s aligned position in the capital structure with ARI across nearly 50% of the loans in the portfolio.”

ARI’s management team, in consultation with ARI’s board of directors, will spend the remainder of the year evaluating a range of commercial real estate–related strategies designed to reposition the Company. In assessing potential new asset strategies, ARI will leverage Apollo’s broader investment platform and origination capabilities. The Company also will consider strategic M&A opportunities.

Mr. Rothstein added: “The goal of any new asset strategy or strategic transaction will be to deliver attractive current yield and position ARI’s shares to trade at or above book value on a go-forward basis.”

During this evaluation period, ARI’s annual management fee rate will be reduced by 50% and paid in shares of common stock to further align the interests of Apollo and ARI stockholders.   If a new asset strategy or a strategic transaction is not announced by year-end, Apollo intends to recommend that ARI’s board of directors explore all available strategic alternatives, including dissolution.

Transaction Highlights

The transaction is expected to offer several compelling benefits to ARI’s stockholders, including:

Valuation Validates Book Value and Delivers an Immediate Premium to Recent Trading Levels – For the last four years, ARI’s shares have traded at a substantial discount, averaging approximately 0.77x of book value. The transaction validates ARI’s book value, representing a compelling ~23% premium to recent stock trading levels.

Loan Portfolio Sale with No Financing Contingency – The proposed transaction (the “Transaction”) includes no financing contingency and provides ARI with immediate liquidity upon closing, following the repayment of substantially all of ARI’s liabilities.

Continuity of Dividend – ARI intends to declare a $0.25 per share dividend for the first quarter of 2026, and to continue paying a quarterly dividend per share of common stock, in each case subject to the approval of the board of directors, targeting an approximately 8% annualized yield on the post-transaction book value per share.

Positions ARI for the Future – Upon closing of the transaction, ARI will emerge as a well-capitalized REIT with a strong balance sheet with approximately $1.4 billion of net cash and a clear runway to design and execute a refreshed strategy.

John Zito, Co-President of Apollo Asset Management, added: “Apollo believes ARI stockholders will unlock significant value from this transaction. Our longstanding commitment has been to deliver strong, positive outcomes in all instances where we manage stockholder capital. With respect to public vehicles we manage, we consistently review underlying portfolio and stock price performance in evaluating potential strategies and options with the objective of maximizing realizable value for stockholders. We will continue to remain disciplined with each entity we manage and guided by a rigorous assessment of risk, liquidity, and return.”

Additional Details

Under the terms of the definitive agreement, ARI may solicit, receive, evaluate and enter into negotiations with respect to alternative proposals from third parties for a period of 25 calendar days, continuing through February 21, 2026. The special committee of the board of directors of ARI, with the assistance of its independent advisors, will actively solicit alternative proposals during this period. There can be no assurance that this process will result in receipt of a superior proposal or that any other transactions may be approved or consummated.

Completion of the Transaction, which is expected to occur in the second quarter of 2026, is subject to, among other things, the approval by the holders of at least a majority of the Company’s outstanding shares of common stock and the satisfaction of customary closing conditions.

BofA Securities is serving as independent financial advisor to the special committee of the board of directors of ARI and Fried, Frank, Harris, Shriver & Jacobson LLP is serving as the special committee’s independent legal advisor; Clifford Chance US LLP is serving as ARI’s legal advisor; Sidley Austin is serving as Athene’s legal advisor and Eastdil Secured is serving as Athene’s financial advisor.

Conference Call

ARI’s management team will host a conference call to discuss this transaction on Wednesday, January 28, 2026 at 8:30a.m. Eastern Time.

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