AFT - AFT: Time To Divest This CEF After The Acquisition (Rating Downgrade)
2024-06-24 03:35:24 ET
Summary
- Apollo Senior Floating Rate Fund is significantly up since the last rating, with total return exceeding 20%.
- MidCap Financial Investment Corporation is acquiring AFT and the Apollo Tactical Income Fund, leading to changes in the management platform and collateral pool.
- AFT will shift towards more illiquid middle market collateral post-merger, prompting a 'Sell' rating and suggesting investors explore alternative leveraged loan CEFs.
- The article presents alternatives covered by the BTA platform in different articles.
Thesis
We wrote about the Apollo Senior Floating Rate Fund ( AFT ) last year, when we highlighted the robustness of the CEF's composition and the benefits the fund had from being managed by a large asset management platform. The CEF is significantly up since our rating, with a total return in excess of 20%:
Prior Rating (Seeking Alpha)