Apollo Global Management (APO) agreed to acquire and take private real estate-focused investment firm Bridge Investment Group (BRDG) in an all-stock deal worth $1.5 billion that is expected to strengthen Apollo's real estate equity platform.

Bridge Investment's shareholders and unitholders will receive 0.07081 shares of Apollo stock for each class A share and common unit, the companies said Monday. The consideration values Bridge Investment's shares and units at $11.50 apiece.

Shares of Bridge Investment surged 37% in midday trading, while those of alternative asset manager Apollo declined 1.4%.

The deal, which requires approval from a majority of Bridge Investment's stockholders and clearance from regulators, is expected to complete in the third quarter. Certain members of Bridge Investment's management and their affiliates, who collectively own 51.4% of the company's class A and B shares, agreed to support the transaction.

Following completion of the deal, Bridge Investment will no longer trade on the New York Stock Exchange and operate as stand-alone platform within Apollo's asset management business.

"We are pleased to announce this transaction with Bridge, which is highly aligned with Apollo's strategic focus on expanding our origination base in areas of our business that are growing but not yet at scale," Apollo Partner David Sambur said in the statement. Bridge Investment's business is anticipated to "complement and further augment" Apollo's existing real estate capabilities, according to Sambur.

Apollo expects the deal to be immediately accretive to its fee-related earnings upon completion. Bridge Investment has about $50 billion in assets under management in real estate products targeting institutional and wealth clients.

"This transaction will allow the Bridge and Apollo teams to grow on the strong foundation that Bridge has built since 2009 as we work to pursue meaningful value and impact for our investors and communities," Bridge Investment Executive Chairman Bob Morse said. "We are confident that Bridge will be positioned for the next phase of growth amid growing demand across the alternative investments space."

As part of the agreement, Morse will become a partner at Apollo and lead its real estate equity franchise.