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KKR has its eye on the US government’s infrastructure stimulus package

22 May 2009

Kohlberg Kravis Roberts & Co, the global alternative assets manager, may take advantage of the US government’s infrastructure stimulus package, according to the Financial Times.

The Obama administration plans to spend hundreds of billions of dollars as part of an initiative to develop the country’s infrastructure. The plans include the development of broadband and renewable energy, as well as more traditional infrastructure such as bridges and roads.

Kravis told the FT, “I think there may be some programmes where it will be appropriate for us to partner with the government. I think one area in particular that I think is a very big need and where we will have opportunities to participate is in infrastructure.”

KKR founders Henry Kravis and George Roberts, however, have said they are less interested in buying up banks or their toxic assets under the Public-Private Investment Program outlined in March.

Private equity firms have started to buy beleaguered banks, with Carlyle and Blackstone having just paid nearly $1bn for BankUnited, a troubled Florida lender, yesterday.

KKR has not followed suit and is playing it safe for the time being, having witnessed a group led by private equity firm TPG invest $7.5bn in Washington Mutual last year. TPG and the other investors lost their money.

Alliance Boots the pharmaceuticals retailer, which was taken private by KKR nearly two years ago in Europe’s largest buy-out, bought back over £400m of debt at a huge discount from distressed sellers earlier this week.

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