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KKR picks up listed specialist finance business KKR Financial, values it at $2.6bn

17 Dec 2013

news_dollars3_lrgUS private equity giant KKR has bought its specialist finance company KKR Financial Holdings in a deal which values the business at $2.6bn.

The company’s asset portfolio spans strategies including leveraged credit through to subordinated and mezzanine debt notes across a number of CLOs, and also invests in special situations, natural resources and commercial real estate.

KKR, which externally manages the listed business, bought it at a 35 per cent premium based on its December 16 closing price.

Henry Kravis and George Roberts, co-chairmen and co-CEOs of KKR, said, “Through this transaction, we are acquiring a business with a fully invested, complementary portfolio of assets while increasing the scale and diversity of KKR’s balance sheet.

“Furthermore, through the distribution of KFN’s realized earnings, the transaction is expected to provide a meaningfully greater recurring component to KKR’s distribution and also be immediately accretive on a total distribution per unit basis.”

KKR revealed in October it had raised $8.3bn for its flagship North American fund, ahead of its fundraising target range of $7bn to $8bn.

The firm’s head of global capital Scott Nuttall said it expected to secure “a handful of final commitments” before the end of the year, adding that KKR currently had more than $17bn of dry powder.

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