UBS Group AG (SIX:UBSG) has called off a deal with Apollo Global Management (NYSE:APO) and Credit Suisse regarding the management of certain securitized products group (SPG) assets. This decision was announced on Friday, forecasting a third-quarter loss of $600 million for Credit Suisse as a result.
This move marks an unsuccessful last-ditch effort made before UBS's government-mediated rescue, which is aimed at regaining investor trust. The cancellation comes after substantial first close in February when assets, staff including Jay Kim, and $20 billion legacy assets were moved to Apollo's Atlas (NYSE:ATCO) SP.
Despite this cancellation, Apollo Global Management will not experience a windfall from managing the legacy assets. The original deal involving these securitized products was part of a larger strategy by UBS to shift focus and restore confidence among investors. However, the latest development indicates a change in UBS's strategy as it navigates its path to recovery.
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