An executive at Apollo Global Management secretly worked on a multibillion-dollar bid for a life insurance company in competition with his own firm, according to an arbitration ruling.
Ming Dang resigned from Apollo late last year after being confronted by the private equity firm’s management about his covert participation in Caldera Holdings, an insurance start-up created by Imran Siddiqui, a former colleague who left Apollo in 2017.
The ruling, which has been made public by New York state supreme court, detailed how Mr Dang used his fiancée’s personal email account to work on Caldera’s investor presentations.
Even while holding down a high-powered job at Apollo, he spent as many as five hours a day building models for Mr Siddiqui, who bought him a laptop to facilitate the illicit work, the arbitrator said.
The identity of the takeover target that was being pursued by the two sides is redacted in court filings. But people familiar with the matter said it was American Equity Investment Life, a listed retirement annuities specialist that put itself up for sale last year. No transaction has materialised. Athene has brought a separate lawsuit against Caldera in Bermuda, challenging the upstart company’s potential bid.
The private equity firm claimed that Mr Siddiqui was illicitly using Apollo’s confidential documents to advance his new venture — claims that an arbitrator this week partly upheld.
Mr Dang was ordered to pay $1m in damages to Apollo and give up his remaining interest in Apollo funds, while Mr Siddiqui must pay punitive damages of $150,000 after an arbitrator found they had acted disloyally. That was far less than the $300m that Apollo initially sought, and the arbitrator said that while some of Apollo’s claims had succeeded, others had failed. Apollo lost an attempt to bar Caldera from pursuing the potential takeover.
Mr Siddiqui’s lawyer, Lisa Solbakken, compared the damages to travel expenses, claiming they were “less than the MetroCard reimbursement Apollo owed to the 25 lawyers it had working the case”, adding: “To call it a ‘win’ is delusional.”
A spokesperson for Mr Dang said Apollo had lost its bid to prevent Caldera from competing with Athene. He added that Mr Dang had been cleared of stealing confidential information from Apollo, and “looks forward to moving on” despite disagreeing with some of the arbitrator’s findings.
Apollo said the arbitrator’s decision “fully vindicates our position regarding the conduct of Mr Siddiqui and Mr Dang”, adding it would do everything necessary to protect its business and investors.
Mr Siddiqui was a star executive at Apollo, who played a leading role in setting up its insurance affiliate Athene Holding. Created in 2009, the vehicle has proved highly lucrative for Apollo, generating more than $400m in annual fees for managing the insurance company’s investment portfolio.
Caldera aims to replicate Athene’s business model, while hiring cheaper investment managers. An earlier legal action by Apollo against Mr Siddiqui ended in a settlement early last year, with Mr Siddiqui forfeiting about $15m and obtaining a waiver of his non-compete clause.
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