Alternative investment management services provider Apollo Global Management (APO) is in talks to join a consortium that has agreed to acquire U.K.-based supermarket chain Wm Morrison Supermarkets (GB:MRW) for £6.3 billion, according to a report by The Guardian.
The consortium is led by New York-based investment banking firm Fortress Investment Group.
Apollo has investments in private equity, credit and real assets. Its shares closed 2.2% higher on Tuesday. (See Apollo stock chart on TipRanks)
Earlier this month, Apollo was considering to bid for Morrisons, however, changed its stance later.
Apollo said, “The talks may result in funds managed or advised by Apollo forming part of the investment group led by Fortress for the purposes of the Fortress offer. As a consequence of these discussions, Apollo confirms that it does not intend to make an offer for Morrisons other than as part of the Fortress offer.”
Citigroup analyst William Katz recently maintained a Buy rating on the stock and raised the price target from $72 to $76 (32.3% upside potential). In a research note to investors, the analyst said that he expected the sector to grow by at least 50%.
Overall, the stock has a Strong Buy consensus based on 7 Buys and 2 Holds. The average Apollo Global Management price target of $64 implies 11.4% upside potential. Shares have gained 20.2% year-to-date.
According to TipRanks’ Smart Score rating system, Apollo scores a 9 out of 10, suggesting that the stock is likely to outperform market averages.
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