RCS Capital Corp., a network of brokers that sell real estate investment trusts to individual investors, plunged after Apollo Global Management scaled back plans to invest in the company and another entity associated with Nicholas Schorsch.

RCS shares fell as much as 58 percent, the biggest intraday decline since they began trading in June 2013 at $20. They were down 46 percent to 50 cents at 3:50 p.m. in New York.

Apollo and investment-management firm AR Capital mutually agreed on Monday to cancel a transaction in which a new company called AR Global Investments would have absorbed about $19 billion overseen by Schorsch, with Apollo holding a 60 percent stake in AR Global.  As part of the termination of the deal, AR Capital is purchasing from Apollo $25 million of RCS Capital preferred stock for $25.6 million, according to a statement.

Schorsch’s holdings were thrown into disarray in October 2014 when one of his REITs disclosed that it had accounting errors that were intentionally concealed. That company, American Realty Capital Properties Inc., began trading under its new name, Vereit Inc., in July. Schorsch resigned from the boards of 13 companies, including RCS Capital, at the end of December.

“If Nick is a problem, Apollo owning 60 percent would have mitigated that problem in a big way,” said Kevin Gannon, chairman and chief executive officer of Robert A. Stanger & Co., a Shrewsbury, New Jersey-based investment bank that focuses on nontraded REITs. “Now, it’s back to ground zero. We’ll just have to see what his next move is.”

‘Halo’ Effect

Schorsch is still chief executive officer of AR Capital, which manages alternative assets across REITs, business development companies, mutual funds and other partnerships. The deal with Apollo would have allowed Schorsch to monetize the value of his company and take advantage of Apollo’s strong reputation and resources, creating a “halo” effect for the entities sponsored by AR Capital, which have seen fundraising slow since his problems began, Gannon said.

AR Capital collects about $125 million in asset-management fees from companies that have raised about $15.2 billion since inception, according to Gannon. The risk for Schorsch is that the REITs decide to list their shares, merge or liquidate and terminate their external advisory agreement with AR Capital, Gannon said.

“While he’s not raising capital and forming programs at the pace he was previously doing, he is managing a substantial amount of capital at this time and I would estimate that the ARC platform is quite profitable,” Gannon said.

Charles Zehren, an Apollo spokesman at Rubenstein Associates, didn’t return calls seeking comment. Mahmoud Siddig, a spokesman for RCS and AR Capital at Joele Frank, Wilkinson Brimmer Katcher, said the companies wouldn’t comment beyond Monday’s statements.

RCS Capital will go ahead with the sale of its wholesale distribution business, including Realty Capital Securities and Strategic Capital, to Apollo for $6 million in cash, the companies said in a separate statement Monday.

Another company founded by Schorsch, New York REIT Inc., said in its own statement on Monday that it expended its board to add two independent directors and appointed Keith Locker and James Nelson to fill the slots. The board now has seven members, five of which are independent, said the New York-based landlord, which is externally managed by AR Capital. A strategic review to study options to enhance shareholder value “continues to move forward,” Chairman Randolph Read said in the statement.