KKR & Co. Inc., also known as Kohlberg Kravis Roberts & Co., is an American global

investment company An investment company is a financial institution principally engaged in holding, managing and investing securities. These companies in the United States are regulated by the U.S. Securities and Exchange Commission and must be registered under t ...

that manages multiple alternative asset classes, including

private equity In the field of finance, the term private equity (PE) refers to investment funds, usually limited partnerships (LP), which buy and restructure financially weak companies that produce goods and provide services. A private-equity fund is both a t ...

, energy, infrastructure,

real estate Real estate is property consisting of land and the buildings on it, along with its natural resources such as crops, minerals or water; immovable property of this nature; an interest vested in this (also) an item of real property, (more genera ...

, credit, and, through its strategic partners,

hedge fund A hedge fund is a pooled investment fund that trades in relatively liquid assets and is able to make extensive use of more complex trading, portfolio-construction, and risk management techniques in an attempt to improve performance, such as ...

s. , the firm had completed more than 650 private equity investments in portfolio companies with approximately $675 billion of total enterprise value. , assets under management ("AUM") and fee paying assets under management ("FPAUM") were $471 billion and $357 billion, respectively. The firm was founded in 1976 by Jerome Kohlberg Jr., and cousins

Henry Kravis Henry R. Kravis (born January 6, 1944) is an American businessman, investor, and philanthropist.George R. Roberts George Rosenberg Roberts (born 1944) is an American financier. He is one of the three original partners of Kohlberg Kravis Roberts (KKR), which he co-founded alongside Jerome Kohlberg and first cousin Henry Kravis in 1976. Early life George Ro ...

, all of whom had previously worked together at

Bear Stearns The Bear Stearns Companies, Inc. was a New York-based global investment bank, securities trading and brokerage firm that failed in 2008 as part of the global financial crisis and recession, and was subsequently sold to JPMorgan Chase. The com ...

, where they completed some of the earliest

leveraged buyout A leveraged buyout (LBO) is one company's acquisition of another company using a significant amount of borrowed money ( leverage) to meet the cost of acquisition. The assets of the company being acquired are often used as collateral for the loa ...

transactions. Since its founding, KKR has completed a number of transactions, including the 1989 leveraged buyout of RJR Nabisco, which was the largest buyout in history to that point, as well as the 2007 buyout of TXU, which is currently the largest buyout completed to date."What's An Aging 'Barbarian' To Do?"
''The New York Times'', August 26, 2001.
''The New York Times'', September 6, 2008. In October 2009, KKR listed shares in the company through KKR & Co., an affiliate that holds 30% of the firm's

ownership equity In finance, equity is ownership of assets that may have debts or other liabilities attached to them. Equity is measured for accounting purposes by subtracting liabilities from the value of the assets. For example, if someone owns a car worth $2 ...

, with the remainder held by the firm's partners. In March 2010, KKR filed to list its shares on the

New York Stock Exchange The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its liste ...

(NYSE), with trading commencing four months later, on July 15, 2010. KKR had offices in 21 cities in 16 countries across five continents.KKR locations
(company Web site); retrieved March 8, 2010. The firm was headquartered in the

Solow Building The Solow Building, also known as 9 West 57th Street, is a skyscraper in the Midtown Manhattan neighborhood of New York City. Completed in 1974 and designed by Gordon Bunshaft of Skidmore, Owings & Merrill, it is west of Fifth Avenue betwee ...

(9 West 57th Street, New York, New York), but in October 2015, announced its intention to occupy the newly-constructed

30 Hudson Yards 30 Hudson Yards (also the North Tower) is a supertall skyscraper in the West Side of Midtown Manhattan, New York City. Located near Hell's Kitchen, Chelsea, and the Penn Station area, the building is part of the Hudson Yards Redevelopmen ...

The firm

KKR is led by its executive leadership team,

, Joseph Bae, and Scott C. Nuttall. The firm employs approximately 375 investment professionals and 1,250 total employees as of December 31, 2017. KKR is headquartered at

, Manhattan, New York, with offices in Menlo Park and

San Francisco San Francisco (; Spanish for " Saint Francis"), officially the City and County of San Francisco, is the commercial, financial, and cultural center of Northern California. The city proper is the fourth most populous in California and 17t ...

(

California California is a state in the Western United States, located along the Pacific Coast. With nearly 39.2million residents across a total area of approximately , it is the most populous U.S. state and the 3rd largest by area. It is also the m ...

Houston Houston (; ) is the most populous city in Texas, the most populous city in the Southern United States, the fourth-most populous city in the United States, and the sixth-most populous city in North America, with a population of 2,304,580 ...

(

Texas Texas (, ; Spanish: ''Texas'', ''Tejas'') is a state in the South Central region of the United States. At 268,596 square miles (695,662 km2), and with more than 29.1 million residents in 2020, it is the second-largest U.S. state by ...

London London is the capital and List of urban areas in the United Kingdom, largest city of England and the United Kingdom, with a population of just under 9 million. It stands on the River Thames in south-east England at the head of a estuary dow ...

Dublin Dublin (; , or ) is the capital and largest city of Ireland. On a bay at the mouth of the River Liffey, it is in the province of Leinster, bordered on the south by the Dublin Mountains, a part of the Wicklow Mountains range. At the 2016 ...

Paris Paris () is the capital and most populous city of France, with an estimated population of 2,165,423 residents in 2019 in an area of more than 105 km² (41 sq mi), making it the 30th most densely populated city in the world in 2020. Si ...

Madrid Madrid ( , ) is the capital and most populous city of Spain. The city has almost 3.4 million inhabitants and a metropolitan area population of approximately 6.7 million. It is the second-largest city in the European Union (EU), and ...

Luxembourg Luxembourg ( ; lb, Lëtzebuerg ; french: link=no, Luxembourg; german: link=no, Luxemburg), officially the Grand Duchy of Luxembourg, ; french: link=no, Grand-Duché de Luxembourg ; german: link=no, Großherzogtum Luxemburg is a small lan ...

Hong Kong Hong Kong ( (US) or (UK); , ), officially the Hong Kong Special Administrative Region of the People's Republic of China (abbr. Hong Kong SAR or HKSAR), is a List of cities in China, city and Special administrative regions of China, special ...

Tokyo Tokyo (; ja, 東京, , ), officially the Tokyo Metropolis ( ja, 東京都, label=none, ), is the capital and largest city of Japan. Formerly known as Edo, its metropolitan area () is the most populous in the world, with an estimated 37.46 ...

Beijing } Beijing ( ; ; ), Chinese postal romanization, alternatively romanized as Peking ( ), is the Capital city, capital of the China, People's Republic of China. It is the center of power and development of the country. Beijing is the world's Li ...

Shanghai Shanghai (; , , Standard Chinese, Standard Mandarin pronunciation: ) is one of the four Direct-administered municipalities of China, direct-administered municipalities of the China, People's Republic of China (PRC). The city is located on the ...

Mumbai Mumbai (, ; also known as Bombay — the official name until 1995) is the capital city of the Indian state of Maharashtra and the ''de facto'' financial centre of India. According to the United Nations, as of 2018, Mumbai is the secon ...

Dubai Dubai (, ; ar, wikt:دبي, دبي, translit=Dubayy, , ) is the List of cities in the United Arab Emirates#Major cities, most populous city in the United Arab Emirates (UAE) and the capital of the Emirate of Dubai, the most populated of the 7 ...

Riyadh Riyadh (, ar, الرياض, 'ar-Riyāḍ, lit.: 'The Gardens' Najdi pronunciation: ), formerly known as Hajr al-Yamamah, is the capital and largest city of Saudi Arabia. It is also the capital of the Riyadh Province and the centre of the ...

Seoul Seoul (; ; ), officially known as the Seoul Special City, is the Capital city, capital and largest metropolis of South Korea.Before 1972, Seoul was the ''de jure'' capital of the North Korea, Democratic People's Republic of Korea (North Korea ...

São Paulo São Paulo (, ; Portuguese for ' Saint Paul') is the most populous city in Brazil, and is the capital of the state of São Paulo, the most populous and wealthiest Brazilian state, located in the country's Southeast Region. Listed by the GaW ...

Singapore Singapore (), officially the Republic of Singapore, is a sovereign island country and city-state in maritime Southeast Asia. It lies about one degree of latitude () north of the equator, off the southern tip of the Malay Peninsula, bor ...

, and

Sydney Sydney ( ) is the capital city of the state of New South Wales, and the most populous city in both Australia and Oceania. Located on Australia's east coast, the metropolis surrounds Sydney Harbour and extends about towards the Blue Mounta ...

Senior leadership

* ''Chairmen:''

Henry Kravis Henry R. Kravis (born January 6, 1944) is an American businessman, investor, and philanthropist.George Roberts (since 1987) * ''Chief Executives:'' Scott Nuttall and Joseph Bae (since 2021)

List of former chairmen

# Jerome Kohlberg Jr. (1976–1987); co-chairmen

List of former CEOs

Henry Kravis Henry R. Kravis (born January 6, 1944) is an American businessman, investor, and philanthropist.George Roberts, and Jerome Kohlberg Jr. (1976–1987); co-CEOs #

Henry Kravis Henry R. Kravis (born January 6, 1944) is an American businessman, investor, and philanthropist.George Roberts (1987–2021); co-CEOs

Business structure

In a 2016 interview with Bloomberg, founder Henry Kravis described KKR in terms of three broad buckets: private markets, public markets, and capital markets. The firm has traditionally specialized in

investments, focusing on specific industry sectors where the firm has created dedicated investment groups, including:

Business segments

KKR's business operates in four segments: private markets, public markets, capital markets, and principal activities. Through its private markets segment, the firm manages and sponsors a group of private equity funds that invest capital for long-term appreciation, either through controlling ownership of a company or strategic minority positions. In addition to traditional private equity funds, KKR sponsors investment funds that invest in growth equity and core equity. The firm also manages and sponsors investment funds that invest capital in real assets, such as infrastructure, energy, and real estate.

Private markets

KKR has raised 23 private and growth equity funds with approximately $102.9 billion of capital commitments through December 31, 2017. Its private equity investment strategy typically seeks to engage primarily in management buyouts, build-ups, or other investments with a view to acquiring a controlling or significant influence. The firm has sourced several smaller growth equity investments and expanded the business by launching dedicated growth equity funds. KKR's first dedicated growth equity fund, launched in 2016, invests in the technology, media, and telecommunications sector, primarily in the United States, Canada, Europe, and Israel. In 2016, KKR also launched its second dedicated growth equity fund to pursue investments in the health care sector, also primarily in the United States. As of December 31, 2017, they have received $2.0 billion of capital commitments to these strategies. In 2017, they further expanded on their private equity business by making their first core equity investment, targeting investments that have a longer holding period and a lower risk profile. ''Energy'' KKR's energy business aims to deliver current returns to fund investors through distributions generated by producing and selling oil and natural gas reserves and capital appreciation and targets real asset investments across the upstream and midstream segments of the oil and gas industry. KKR invests in these energy strategies primarily through the KKR Energy Income and Growth Fund. As of December 31, 2017, they have received $2.9 billion of capital commitments to their energy funds and $1.0 billion of capital commitments to this strategy through separately managed accounts. ''Infrastructure'' KKR's infrastructure platform seeks to achieve returns including current income through the acquisition and operational improvement of assets important to the functioning of the economy. The platform has made investments in parking, alternative energy, district heating and contracted electricity generation, water, and wastewater, locomotive transportation, midstream, and telecommunications infrastructure. As of December 31, 2017, KKR had received $4.1 billion of capital commitments to its infrastructure funds and $1.1 billion of capital commitments to this strategy through separately managed accounts and co-investment vehicles. ''Real Estate'' KKR's real estate platform targets real estate equity primarily in the United States and Western Europe. The firm's equity investments include direct investments in real property, debt, special situations transactions, and businesses with significant real estate holdings. As of December 31, 2017, KKR has received $3.9 billion of capital commitments through its real estate equity investment funds. KKR's real estate credit platform provides capital services for complex real estate transactions with a focus on commercial mortgage-backed securities, whole loans, and subordinated debt. As of December 31, 2017, KKR managed approximately $2.2 billion of assets in its real estate credit strategy, which includes KKR Real Estate Finance Trust Inc. ("KREF"), an NYSE-listed real estate investment trust ("REIT"), and $1.1 billion of capital commitments through a real estate credit fund.

Public markets

''Credit'' KKR's credit business invests capital in leveraged credit strategies, including leveraged loans, high-yield bonds, opportunistic credit and revolving credit strategies, and alternative credit strategies, including special situations and private credit strategies such as direct lending and private opportunistic credit (or mezzanine) investment strategies. ''Hedge Funds'' KKR's hedge fund business consists of strategic manager partnerships with third-party hedge fund managers in which KKR owns a minority stake. As of December 31, 2017, the strategic manager partnerships with third-party hedge fund managers accounted for $26.2 billion of AUM. ''BDCs'' In December 2017, FS Investments and KKR announced they are pooling together more than $18 billion in private capital to invest in mid-sized businesses, in a push to do bigger deals which are out of reach for other alternative lenders.

Capital markets

KKR's capital markets business mainly arranges debt and equity transactions for the firm, its portfolio companies, and third parties. KKR's capital markets group raised $815 million of debt needed to close the purchase of Mills Fleet Farm in 2016.

Principal activities

The Principal Activities segment uses KKR's balance sheet assets to support its investment management and capital markets businesses. KKR uses this capital for general partner commitments and to establish a track record for fundraising purposes in new strategies, such as the approximately $1 billion invested in KKR's real estate business as of 2017.

History

Founding and early history

While running the corporate finance department for

in the 1960s and 1970s, Jerome Kohlberg, and later

Henry Kravis Henry R. Kravis (born January 6, 1944) is an American businessman, investor, and philanthropist.George Roberts, completed a series of what they described as "bootstrap" investments. They targeted family-owned businesses, many of which had been founded in the years following

World War II World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the World War II by country, vast majority of the world's countries—including all of the great power ...

, that were facing succession issues. Many of these companies lacked a viable exit for their founders because they were too small to be taken public and the founders were reluctant to sell out to competitors. Henry Kravis

In 1964, Lewis Cullman acquired and then sold Orkin Exterminating Company in what some call the first significant

transaction. In the following years the three

bankers completed a series of buyouts including Stern Metals (1965), Incom (a division of Rockwood International, 1971), Cobblers Industries (1971), and Boren Clay (1973), as well as Thompson Wire, Eagle Motors and Barrows through their investment in Stern Metals. Despite a number of highly successful investments, the $27 million investment in Cobblers ended in bankruptcy. By 1976, tensions had built up between

and Kohlberg, Kravis and Roberts, which led to the formation of Kohlberg Kravis Roberts & Co. The name had been going to be Kohlberg Roberts Kravis, but public relations advisors preferred the sound of KKR. Most notably, Bear Stearns executive

Cy Lewis Salim L. "Cy" Lewis (October 5, 1908 – April 28, 1978) was the Managing Partner of Bear, Stearns & Company, running the company from 1949 until shortly before his death in 1978. Early life Salim or "Cy" was born Salim Lissner Lewis on October ...

had rejected repeated proposals to form a dedicated investment fund within Bear Stearns. The new KKR completed its first buyout, of manufacturer A.J. Industries, in 1976. KKR raised capital from a small group of investors including the Hillman Company and First Chicago Bank. By 1978, with the revision of the

ERISA The Employee Retirement Income Security Act of 1974 (ERISA) (, codified in part at ) is a U.S. federal tax and labor law that establishes minimum standards for pension plans in private industry. It contains rules on the federal income tax e ...

regulations, the nascent KKR was successful in raising its first institutional fund with over $30 million of investor commitments. In 1981, KKR expanded its investor base after the Oregon State Treasury's public pension fund invested in KKR's acquisition of retailer Fred Meyer, Inc. Oregon State remains an active investor in KKR funds. In 1979 KKR completed a risky, precedent-setting ($380 million) public-to-private leveraged buyout of a large conglomerate

Houdaille Industries Houdaille Industries was a diversified manufacturing company which produced automotive products, industrial products, machine tools, construction materials and contracting. The company had its beginnings in Buffalo, New York, in 1919, where the ...

, a well-known producer of machine tools, industrial pipes, chrome-plated

car bumper A bumper is a structure attached to or integrated with the front and rear ends of a motor vehicle, to absorb impact in a minor collision, ideally minimizing repair costs. Stiff metal bumpers appeared on automobiles as early as 1904 that had a ...

s and torsional viscous dampers, which they signed the previous year., pp. 149–169. It soon ended in a spectacular failure, breakup of the half-a-century-old company and loss of thousands of jobs, even though creditors earned a profit. Among the firm's acquisitions during the 1980s buyout boom were:

Buyout of RJR Nabisco

At age 61, Kohlberg resigned in 1987 (he later founded his own private equity firm, Kohlberg & Co.), and Henry Kravis succeeded him as senior partner. Under Kravis and Roberts, the firm was responsible for the 1988

of RJR Nabisco. RJR Nabisco was the largest buyout in history at that time, at $25 billion, and remained the largest buyout for the next 17 years. The deal was chronicled in '' Barbarians at the Gate: The Fall of RJR Nabisco'', and later made into a television movie starring

James Garner James Garner (born James Scott Bumgarner; April 7, 1928 – July 19, 2014) was an American actor. He played leading roles in more than 50 theatrical films, including ''The Great Escape (film), The Great Escape'' (1963) with Steve McQueen; Paddy ...

. In 1988, F. Ross Johnson was the president and CEO of RJR Nabisco, the company formed in 1985 by the merger of

Nabisco Brands Nabisco (, abbreviated from the earlier name National Biscuit Company) is an American manufacturer of cookies and snacks headquartered in East Hanover, New Jersey. The company is a subsidiary of Illinois-based Mondelēz International. Nabisco ...

and R.J. Reynolds Tobacco Company, a leading producer of food products. In October of that year, Johnson proposed a $17 billion ($75 per share)

management buyout A management buyout (MBO) is a form of acquisition in which a company's existing managers acquire a large part, or all, of the company, whether from a parent company or individual. Management-, and/or leveraged buyout became noted phenomena o ...

of the company with the financial backing of investment bank Shearson Lehman Hutton and its parent company,

American Express American Express Company (Amex) is an American multinational corporation, multinational corporation specialized in payment card industry, payment card services headquartered at 200 Vesey Street in the Battery Park City neighborhood of Lower Man ...

. Several days later, Kravis, who had originally suggested the idea of the buyout to Johnson, presented a new bid for $20.3 billion ($90 per share) financed with an aggressive debt package. KKR had the support of equity co-investments from

pension fund A pension fund, also known as a superannuation fund in some countries, is any plan, fund, or scheme which provides retirement income. Pension funds typically have large amounts of money to invest and are the major investors in listed and priva ...

s and other

institutional investor An institutional investor is an entity which pools money to purchase securities, real property, and other investment assets or originate loans. Institutional investors include commercial banks, central banks, credit unions, government-linked ...

s. Investors included

Coca-Cola Coca-Cola, or Coke, is a carbonated soft drink manufactured by the Coca-Cola Company. Originally marketed as a temperance bar, temperance drink and intended as a patent medicine, it was invented in the late 19th century by John Stith Pembe ...

Georgia-Pacific Georgia-Pacific LLC is an American pulp and paper company based in Atlanta, Georgia, and is one of the world's largest manufacturers and distributors of tissue, pulp, paper, toilet and paper towel dispensers, packaging, building products and ...

and

United Technologies United Technologies Corporation (UTC) was an American multinational conglomerate headquartered in Farmington, Connecticut. It researched, developed, and manufactured products in numerous areas, including aircraft engines, aerospace systems, ...

corporate pension funds, as well as endowments from

MIT The Massachusetts Institute of Technology (MIT) is a private land-grant research university in Cambridge, Massachusetts. Established in 1861, MIT has played a key role in the development of modern technology and science, and is one of the m ...

Harvard Harvard University is a private Ivy League research university in Cambridge, Massachusetts. Founded in 1636 as Harvard College and named for its first benefactor, the Puritan clergyman John Harvard, it is the oldest institution of higher le ...

and the New York State Common Retirement Fund"Several Giant Pension Funds Investing in Offer for Nabisco"
''The New York Times'', October 31, 1988. However, KKR faced criticism from existing investors over the firm's use of hostile tactics in the buyout of RJR. KKR proposed to provide a joint offer with Johnson and Shearson Lehman but was rebuffed and Johnson attempted to stonewall KKR's access to financial information from RJR. Rival private equity firm Forstmann Little & Co. was invited into the process by Shearson Lehman but attempted to provide a bid for RJR with a consortium of

Goldman Sachs Capital Partners Goldman Sachs Capital Partners is the private equity arm of Goldman Sachs, focused on leveraged buyout and growth capital investments globally. The group, which is based in New York City, was founded in 1986. As of 2019, GS Capital Partners ...

Procter & Gamble The Procter & Gamble Company (P&G) is an American multinational consumer goods corporation headquartered in Cincinnati, Ohio, founded in 1837 by William Procter and James Gamble. It specializes in a wide range of personal health/consumer he ...

Ralston Purina Ralston Purina Company was a St. Louis, Missouri,–based American conglomerate with substantial holdings in animal feed, food, pet food, consumer products, and entertainment. On December 12, 2001, it merged with Swiss food-giant Nestlé's Fr ...

and

Castle & Cooke Castle & Cooke, Inc., is a Los Angeles-based company that was once part of the Big Five companies in territorial Hawaii. The company at one time did most of its business in agriculture, including becoming, through mergers with the modern Dole F ...

. Ultimately the Forstmann consortium came apart and did not provide a final bid for RJR. In November 1988, RJR set guidelines for a final bid submission at the end of the month. The management and Shearson group submitted a final bid of $112, a figure they felt certain would enable them to outflank any response by Kravis and KKR. KKR's final bid of $109, while a lower dollar figure, was ultimately accepted by the board of directors of RJR Nabisco. KKR's offer was guaranteed, whereas the management offer lacked a "reset", meaning that the final share price might have been lower than their stated $112 per share. Additionally, many in RJR's board of directors had grown concerned at recent disclosures of Ross Johnson's unprecedented golden parachute deal. ''Time'' magazine featured Johnson on the cover of their December 1988 issue along with the headline, "A Game of Greed: This man could pocket $100 million from the largest corporate takeover in history. Has the buyout craze gone too far?". KKR's offer was welcomed by the board, and, to some observers, it appeared that their elevation of the reset issue as a deal-breaker in KKR's favor was little more than an excuse to reject Johnson's higher bid of $112 per share. Johnson received $53 million from the buyout. KKR collected a $75 million fee in the RJR takeover. At $31.1 billion of а transaction value (including assumed debt), RJR Nabisco was, at the time, by far the largest leveraged buyout in history. In 2006 and 2007, a number of leveraged buyout transactions were completed which surpassed the RJR Nabisco leveraged buyout in terms of the nominal purchase price. The deal was first surpassed in July 2006 by the $33 billion buyout of U.S. hospital operator

Hospital Corporation of America HCA Healthcare is an American for-profit operator of health care facilities that was founded in 1968. It is based in Nashville, Tennessee, and, as of May 2020, owns and operates 186 hospitals and approximately 2,000 sites of care, including sur ...

, in which KKR participated. However, adjusted for inflation, none of the leveraged buyouts of the 2006–07 period would surpass RJR Nabisco.

Early 1990s: The aftermath of RJR Nabisco

The buyout of RJR Nabisco was completed in April 1989 and KKR would spend the early 1990s repaying the RJR's enormous debt load through a series of asset sales and restructuring transactions. KKR did not complete a single investment in 1990, the first such year since 1982. KKR began to focus primarily on its existing portfolio companies acquired during the buyout boom of the late 1980s. Six of KKR's portfolio companies completed IPOs in 1991, including RJR Nabisco and

Duracell Duracell Inc. is an American manufacturer of alkaline batteries, specialty cells, rechargeables and smart power systems, owned by Berkshire Hathaway. The company has its origins in the 1920s, through the work of Samuel Ruben and Philip Mall ...

.Kohlberg Kravis Roberts & Co. Company History
Funding Universe; retrieved February 16, 2009. As the new decade began, KKR began restructuring RJR. In January 1990, it completed the sale of RJR's

Del Monte Foods Del Monte Foods, Inc (trading as Del Monte Foods) is an American food production and distribution company headquartered in Walnut Creek, California. Del Monte Foods is one of the country's largest producers, distributors and marketer of b ...

to a group led by

Merrill Lynch Merrill (officially Merrill Lynch, Pierce, Fenner & Smith Incorporated), previously branded Merrill Lynch, is an American investment management and wealth management division of Bank of America. Along with BofA Securities, the investment ba ...

. KKR had originally identified a group of divisions that it could sell to reduce debt. Over the coming years, RJR would pursue a number of additional restructurings, equity injections, and public offerings of stock to provide the company with added financial flexibility. KKR contributed $1.7 billion of new equity into RJR in July 1990 to complete a restructuring of the company's balance sheet. KKR's equity contribution as part of the original leveraged buyout of RJR had been only $1.5 billion. In mid-December 1990, RJR announced an exchange offer that would swap debt in RJR for a new public stock in the company, effectively an unusual means of taking RJR public again and simultaneously reducing debt on the company. RJR issued additional stock to the public in March 1991 to further reduce debt, resulting in an upgrade of the

credit rating A credit rating is an evaluation of the credit risk of a prospective debtor (an individual, a business, company or a government), predicting their ability to pay back the debt, and an implicit forecast of the likelihood of the debtor defaulting. ...

of RJR's debt from junk to

investment grade In investment, the bond credit rating represents the credit worthiness of corporate or government bonds. It is not the same as an individual's credit score. The ratings are published by credit rating agencies and used by investment professional ...

. KKR began to reduce its ownership in RJR in 1994, when its stock in RJR was used as part of the consideration for its leveraged buyout of

Borden, Inc. Borden, Inc., was an American producer of food and beverage products, consumer products, and industrial products. At one time, the company was the largest U.S. producer of dairy and pasta products. Its food division, Borden Foods, was based in C ...

, a producer of food and beverage products, consumer products, and industrial products. The following year, in 1995, KKR would divest itself of its final stake in RJR Nabisco when Borden sold a $638 million block of stock. While KKR no longer had any ownership of RJR Nabisco by 1995, its original investment would not be fully realized until KKR exited its last investment in 2004. After sixteen years of efforts, including contributing new equity, taking RJR public, asset sales, and exchanging shares of RJR for the ownership of

, KKR finally sold the last remnants of its 1989 investment. In July 2004, KKR agreed to sell its stock in Borden Chemical to

Apollo Management Apollo Global Management, Inc. is an American global private-equity firm. It provides investment management and invests in credit, private equity, and real assets. As of March 31, 2022, the company had $512 billion of assets under management, ...

for $1.2 billion.

Early 1990s: Investments

In the early 1990s, the absence of an active high yield market prompted KKR to change its tactics, avoiding large leveraged buyouts in favor of industry consolidations through what was described as

leveraged buildup A rollup (also "roll-up" or "roll up") is a process used by investors (commonly private equity firms) where multiple small companies in the same market are acquired and merged. The principal aim of a rollup is to reduce costs through economies o ...

s or

rollup A rollup (also "roll-up" or "roll up") is a process used by investors (commonly private equity firms) where multiple small companies in the same market are acquired and merged. The principal aim of a rollup is to reduce costs through economies ...

s. One of KKR's largest investments in the 1990s was the

Primedia Primedia is a South African media group, headquartered in Sandton, Johannesburg. History Primedia was established in 1994 and its listing on the JSE Securities Exchange was completed in April 1995. Primedia remained listed on the JSE until 1 O ...

in partnership with former executives of

Macmillan Publishing Macmillan Publishers (occasionally known as the Macmillan Group; formally Macmillan Publishers Ltd and Macmillan Publishing Group, LLC) is a British publishing company traditionally considered to be one of the 'Big Five' English language publi ...

, which KKR had failed to acquire in 1988. KKR created Primedia's predecessor, K-III Communications, a platform to buy media properties, initially completing the $310 million divisional buyout of the book club division of

Macmillan MacMillan, Macmillan, McMillen or McMillan may refer to: People * McMillan (surname) * Clan MacMillan, a Highland Scottish clan * Harold Macmillan, British statesman and politician * James MacMillan, Scottish composer * William Duncan MacMillan ...

along with the assets of Intertec Publishing Corporation in May 1989."As Primedia Falls, Preferred Stock Lives Up to Its Name"
''The New York Times'', October 26, 2005. During the early 1990s, K-III continued acquiring publishing assets, including a $650 million acquisition from

News Corporation News Corporation (abbreviated News Corp.), also variously known as News Corporation Limited, was an American multinational mass media corporation controlled by media mogul Rupert Murdoch and headquartered at 1211 Avenue of the Americas in New ...

in 1991.https://query.nytimes.com/gst/fullpage.html?res=9D0CE1DF103BF93AA15757C0A967958260 , ''The New York Times'', April 29, 1991 K-III went public, however instead of cashing out, KKR continued to make new investments in the company in 1998, 2000 and 2001 to support acquisition activity. In 2005, Primedia redeemed KKR's

preferred stock Preferred stock (also called preferred shares, preference shares, or simply preferreds) is a component of share capital that may have any combination of features not possessed by common stock, including properties of both an equity and a debt inst ...

in the company but KKR was estimated to have lost hundreds of millions of dollars on its

common stock Common stock is a form of corporate equity ownership, a type of security. The terms voting share and ordinary share are also used frequently outside of the United States. They are known as equity shares or ordinary shares in the UK and other Comm ...

holdings as the price of the company's stock collapsed. In 1991, KKR partnered with Fleet/Norstar Financial Group in the 1991 acquisition of the

Bank of New England The Bank of New England Corporation was a regional banking institution based in Boston, Massachusetts, which was seized by the Federal Deposit Insurance Corporation (FDIC) in 1991 as a result of heavy losses in its loan portfolio and was placed i ...

, from the US

Federal Deposit Insurance Corporation The Federal Deposit Insurance Corporation (FDIC) is one of two agencies that supply deposit insurance to depositors in American depository institutions, the other being the National Credit Union Administration, which regulates and insures cr ...

. In January 1996, KKR would exchange its investment for a 7.5% interest in

Fleet Bank FleetBoston Financial was a Boston, Massachusetts-based bank created in 1999 by the merger of Fleet Financial Group and BankBoston. In 2004 it merged with Bank of America; all of its banks and branches were converted to Bank of America. Histor ...

. KKR completed the 1992 buyout of American Re Corporation from

Aetna Aetna Inc. () is an American managed health care company that sells traditional and consumer directed health care insurance and related services, such as medical, pharmaceutical, dental, behavioral health, long-term care, and disability plans, ...

as well as a 47% interest in TW Corporation, later known as The Flagstar Companies and owner of

Denny's Denny's (also known as Denny's Diner on some of the locations' signage) is an American table service diner-style restaurant chain. It operates over 1,700 restaurants in many countries. Description Originally opened as a coffee shop under t ...

in 1992. Among the other notable investments KKR completed in the early 1990s included

World Color Press World Color Press Inc. ("Worldcolor") (formerly Quebecor World) was a company which provided high-value and comprehensive print, digital, and related services to businesses worldwide. World Color and its subsidiaries printed various commercial pr ...

(1993–95),

RELTEC Corporation The General Electric Company (GEC) was a major British industrial conglomerate involved in consumer and defence electronics, communications, and engineering. The company was founded in 1886, was Britain's largest private employer with over 250 ...

(1995) and

Bruno's Bruno's Supermarkets, LLC was an American chain of grocery stores with its headquarters in Birmingham, Alabama. It was founded in 1932 by Joseph Bruno in Birmingham. During the company's pinnacle, it operated over 300 stores under the names Brun ...

(1995).

1996–1999

By the mid-1990s, the debt markets were improving and KKR had moved on from the RJR Nabisco buyout. In 1996, KKR was able to complete the bulk of fundraising for what was then a record $6 billion private equity fund, the KKR 1996 Fund. However, KKR was still burdened by the performance of the RJR investment and repeated obituaries in the media. KKR was required by its investors to reduce the fees it charged and to calculate its

carried interest Carried interest, or carry, in finance, is a share of the profits of an investment paid to the investment manager specifically in alternative investments (private equity and hedge funds). It is a performance fee, rewarding the manager for enhanc ...

based on the total profit of the fund (i.e., offsetting losses from failed deals against the profits from successful deals). Regal Cinemas Imax Theatre

KKR's activity level would accelerate over the second half of the 1990s making a series of notable investments including Spalding Holdings Corporation and Evenflo (1996),

Newsquest Newsquest Media Group Ltd. is the second largest publisher of regional and local newspapers in the United Kingdom. It is owned by the American mass media holding company Gannett. It has 205 brands across the UK, publishing online and in print ...

(1996), KinderCare Learning Centers (1997), Amphenol Corporation (1997),

Randalls Food Markets Randalls operates 32 supermarkets in Texas under the ''Randalls'' and ''Flagship Randalls'' banners. The chain consists of 13 stores located around the Houston area and 15 stores located around the Austin area as of May 2020. Randalls today forms ...

(1997), The Boyds Collection (1998), MedCath Corporation (1998),

Willis Group Holdings Willis Group Holdings plc was a multinational risk advisor, insurance brokerage and reinsurance brokerage company with its headquarters in the Willis Building in London until its merger of equals with financial services company Towers Watson ...

(1998),

Smiths Group Smiths Group plc is a British, multinational, diversified engineering business headquartered in London, England. It operates in over 50 countries and employs 14,600 staff. Smiths Group has its origins in a jewellery shop, ''S Smith & Sons'', ...

(1999), and

Wincor Nixdorf Wincor Nixdorf was a German corporation that provided retail and retail banking hardware, software, and services. Wincor Nixdorf was engaged primarily in the sale, manufacture, installation and service of self-service transaction systems (such a ...

(1999). KKR's largest investment of the 1990s would be one of its least successful. In January 1998, KKR and

Hicks, Muse, Tate & Furst HM Capital Partners was a private equity firm in the United States that specialized in leveraged buyouts. The firm was previously known as Hicks, Muse, Tate & Furst. It was founded in 1989 by Tom Hicks and John Muse as Hicks, Muse & Co. and was c ...

agreed to the $1.5 billion buyouts of Regal Entertainment Group. KKR and Hicks Muse had initially intended to combine Regal with Act III Cinemas, which KKR had acquired in 1997 for $706 million and

United Artists Theaters Regal Cinemas (also Regal Entertainment Group) is an American movie theater chain headquartered in Knoxville, Tennessee. A division of Cineworld, Regal operates the second-largest theater circuit in the United States, with over 7,200 screens i ...

, which Hicks Muse had agreed to acquire for $840 million in November 1997. Shortly after agreeing to the Regal takeover, the deal with United Artists fell apart, destroying the strategy to eliminate costs by building a larger combined company. Two years later, in 2000, Regal encountered significant financial issues and was forced to file for bankruptcy protection; the company passed to billionaire investor

Philip Anschutz Philip Frederick Anschutz ( ; born December 28, 1939) is an American billionaire businessman who owns or controls companies in a variety of industries, including energy, railroads, real estate, sports, newspapers, movies, theaters, arenas and m ...

2000–2005

At the start of the 21st century, the landscape of large leveraged buyout firms was changing. Several large and storied firms, including

Hicks Muse Tate & Furst HM Capital Partners was a private equity firm in the United States that specialized in leveraged buyouts. The firm was previously known as Hicks, Muse, Tate & Furst. It was founded in 1989 by Tom Hicks and John Muse as Hicks, Muse & Co. and was c ...

and

Forstmann Little & Company Forstmann, Little & Company was a private equity firm, specializing in leveraged buyouts (LBOs). At its peak in the late 1990s, Forstmann Little was among the largest private equity firms globally. Ultimately, the firm would suffer from the burs ...

were dragged down by heavy losses in the bursting of the telecom bubble. Although KKR's track record since RJR Nabisco was mixed, losses on such investments as Regal Entertainment Group, Spalding, Flagstar and

(previously K-III Communications) were offset by successes in Willis Group, Wise Foods, Inc.,

and

MTU Aero Engines MTU Aero Engines AG is a German aircraft engine manufacturer. MTU develops, manufactures and provides service support for military and civil aircraft engines. MTU Aero Engines was formerly known as MTU München. History While the Munich-based en ...

, among others. Additionally, KKR was one of the few firms that were able to complete large leveraged buyout transactions in the years immediately following the collapse of the Internet bubble, including

Shoppers Drug Mart Shoppers Drug Mart Inc. (named Pharmaprix in Quebec) is a Canadian retail pharmacy chain based in Toronto, Ontario. It has more than 1,300 stores in nine provinces and two territories. The company was founded by pharmacist Murray Koffler in 1 ...

and Bell Canada Yellow Pages. KKR was able to realize its investment in Shoppers Drug Mart through a 2002 IPO and subsequent public stock offerings.Shoppers Drug Mart Sells Shares
Retail Merchandiser, March 17, 2004; retrieved February 16, 2009. The directories business would be taken public in 2004 as Yellow Pages Income Fund, a Canadian

income trust An income trust is an investment that may hold equities, debt instruments, royalty interests or real properties. They are especially useful for financial requirements of institutional investors such as pension funds, and for investors such as retir ...

In 2004 a

consortium A consortium (plural: consortia) is an association of two or more individuals, companies, organizations or governments (or any combination of these entities) with the objective of participating in a common activity or pooling their resources ...

comprising KKR,

Bain Capital Bain Capital is an American private investment firm based in Boston. It specializes in private equity, venture capital, credit, public equity, impact investing, life sciences, and real estate. Bain Capital invests across a range of industry se ...

and real estate development company

Vornado Realty Trust Vornado Realty Trust is a real estate investment trust formed in Maryland in 1982, with its primary office in New York City. The company invests in office buildings and street retail in Manhattan. Investments Notable properties owned by the ...

announced the $6.6 billion acquisition of

Toys "R" Us Toys "R" Us is an American toy, clothing, and baby product retailer owned by Tru Kids (doing business as Tru Kids Brands) and various others. The company was founded in 1957; its first store was built in April 1948, with its headquarters loca ...

, the toy retailer. A month earlier,

Cerberus Capital Management Cerberus Capital Management, L.P. is an American private equity firm,Leaders Magazine"Providing Economic Opportunity: An Interview with The Honorable Dan Quayle, Chairman, Cerberus Global Investments, LLC". specializing in distressed investing. ...

, made a $5.5 billion offer for both the toy and baby supplies businesses. The Toys 'R' Us buyout was one of the largest in several years. Following this transaction, by the end of 2004 and in 2005, major buyouts were once again becoming common and market observers were stunned by the leverage levels and financing terms obtained by financial sponsors in their buyouts. In 2005, KKR was one of seven private equity firms involved in the buyout of

SunGard SunGard was an American multinational company based in Wayne, Pennsylvania, which provided software and services to education, financial services, and public sector organizations. It was formed in 1983, as a spin-off of the computer services ...

in a transaction valued at $11.3 billion. KKR's partners in the acquisition were

Silver Lake Partners Silver Lake is an American global private equity firm focused on investments in technology, technology-enabled and related industries. Founded in 1999, the firm is one of the largest technology investors in the world. Its investment holdings hav ...

Blackstone Group Blackstone Inc. is an American alternative investment management company based in New York City. Blackstone's private equity business has been one of the largest investors in leveraged buyouts in the last three decades, while its real estate bu ...

Providence Equity Partners Providence Equity Partners L.L.C. is a specialist private equity investment firm focused on media, communications, education, technology investments across North America and Europe. The firm specializes in growth-oriented private equity investme ...

, and

TPG Capital TPG Inc., previously known as Texas Pacific Group and TPG Capital, is an American investment company based in Fort Worth, Texas. The private equity firm is focused on leveraged buyouts and growth capital. TPG manages investment funds in growth c ...

. This represented the largest leveraged buyout completed since the takeover of RJR Nabisco in 1988. SunGard was the largest buyout of a technology company until the Blackstone-led buyout of

Freescale Semiconductor Freescale Semiconductor, Inc. was an American semiconductor manufacturer. It was created by the divestiture of the Semiconductor Products Sector of Motorola in 2004. Freescale focused their integrated circuit products on the automotive, em ...

. The SunGard transaction was notable given the number of firms involved in the transaction, the largest

club deal A club deal, in finance, refers to a leveraged buyout or other private equity investment that involves two or more private equity firms. It can also be referred as consortium or syndicated investment. Definition In a club deal, the investor grou ...

completed to that point. The involvement of seven firms in the consortium was criticized by investors in private equity who considered cross-holdings among firms to be generally unattractive.

Since 2005 and the Buyout Boom

In 2006, KKR raised a new $17.6 billion fund the KKR 2006 Fund, with which the firm began executing a series of some of the largest buyouts in history. KKR's $44 billion takeover of Texas-based power utility TXU in 2007 proved to be the largest leveraged buyout of the mid-2000s buyout boom and the largest buyout completed to date. Among the most notable companies acquired by KKR in 2006 and 2007 were the following: Other non-buyout investments completed by KKR during this period included

Legg Mason Legg Mason was an American investment management and asset management firm headquartered in Baltimore, founded in 1899 and acquired by Franklin Templeton Investments as of July 2020. As of December 31, 2019, the company had $730.8 billion in as ...

Sun Microsystems Sun Microsystems, Inc. (Sun for short) was an American technology company that sold computers, computer components, software, and information technology services and created the Java programming language, the Solaris operating system, ZFS, t ...

, Tarkett,

Longview Power Plant Longview Power Plant is a coal-fired power plant located near Maidsville, West Virginia. The plant's single unit generates 700 megawatt ( MW) of electricity from run-of-mine coal and natural gas. History The Longview Power project cost approxima ...

, and

Seven Network The Seven Network (commonly known as Channel Seven or simply Seven) is a major Australian commercial free-to-air Television broadcasting in Australia, television network. It is owned by Seven West Media, Seven West Media Limited, and is one of ...

. In October 2006, KKR acquired a 50% stake in Tarkett, a France-based distributor of flooring products, in a deal valued at about €1.4 billion ($1.8 billion). On November 20, 2006, KKR announced it would form a A$4 billion partnership with the

of Australia. On January 23, 2007, KKR announced it would invest $700 million through a PIPE investment in

. In January 2008, KKR announced it had made a $1.25 billion PIPE investment in

through a convertible preferred stock offering. In addition to its successful buyout transactions, KKR was involved in the failed buyout of Harman International Industries (), an upscale audio equipment maker. On April 26, 2007, Harman announced it had entered an agreement to be acquired by KKR and

Goldman Sachs Goldman Sachs () is an American multinational investment bank and financial services company. Founded in 1869, Goldman Sachs is headquartered at 200 West Street in Lower Manhattan, with regional headquarters in London, Warsaw, Bangalore, Ho ...

. In September 2007, KKR and Goldman backed out of the $8 billion buyout of Harman. By the end of the day, Harman's shares had plummeted by more than 24% upon the news.

Initial public offering

In 2007, KKR filed with the

Securities and Exchange Commission The U.S. Securities and Exchange Commission (SEC) is an independent agency of the United States federal government, created in the aftermath of the Wall Street Crash of 1929. The primary purpose of the SEC is to enforce the law against market ...

KKR & Co. L.P., Form S-1
Securities And Exchange Commission, July 3, 2007 to raise $1.25 billion by selling an ownership interest in its management company. The filing came less than two weeks after the

initial public offering An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investme ...

of rival private equity firm

. KKR had previously listed its KPE vehicle in 2006, but for the first time, KKR would offer investors an ownership interest in the management company itself. The onset of the credit crunch and the shutdown of the IPO market dampened the prospects of obtaining a valuation attractive to KKR. The flotation was repeatedly postponed and called off by the end of August. The following year, in July 2008, KKR announced a new plan to list its shares. The plan called for KKR to complete a

reverse takeover A reverse takeover (RTO), reverse merger, or reverse IPO is the acquisition of a public company by a private company so that the private company can bypass the lengthy and complex process of going public. Sometimes, conversely, the public compa ...

of its listed affiliate

KKR Private Equity Investors KKR & Co. Inc., also known as Kohlberg Kravis Roberts & Co., is an American global investment company that manages multiple alternative asset classes, including private equity, energy, infrastructure, real estate, credit, and, through its strateg ...

in exchange for a 21% interest in the firm. In November 2008, KKR announced a delay of this transaction until 2009. Shares of KPE had declined significantly in the second half of 2008 with the onset of the

credit crunch A credit crunch (also known as a credit squeeze, credit tightening or credit crisis) is a sudden reduction in the general availability of loans (or credit) or a sudden tightening of the conditions required to obtain a loan from banks. A credit cr ...

. KKR has announced that it expects to close the transaction in 2009. In October 2009, KKR listed shares in KKR & Co. on the

Euronext Euronext N.V. (short for European New Exchange Technology) is a pan-European bourse that offers various trading and post-trade services. Traded assets include regulated equities, exchange-traded funds (ETF), warrants and certificates, bonds, ...

exchange, replacing KPE and anticipates a listing on the

in 2010. The public entity represents a 30% interest in Kohlberg Kravis Roberts. In October 2010, KKR acquired about nine members of Goldman Sachs Group

proprietary trading Proprietary trading (also known as prop trading) occurs when a trader trades stocks, bonds, currencies, commodities, their derivatives, or other financial instruments with the firm's own money (instead of using depositors' money) in order to ma ...

team after entertaining offers from investment firms such as Perella Weinberg and Blackrock. With Goldman shutting down its proprietary trading operations, its executives, led by Bob Howard, will help KKR expand beyond leveraged buyouts into areas such as hedge funds.

2010–present

In December 2011, Samson Investment Company was acquired by a group of private equity investors led by KKR for approximately $7.2 billion and Samson Resources Corporation was formed. With the severe downturn in oil and natural gas prices, in September 2015, the Company went into Chapter 11 bankruptcy and during its bankruptcy process, sold several large assets. In March 2013, KKR exited its joint venture in music company

BMG Rights Management BMG Rights Management GmbH (also known simply as BMG) is an international music company based in Berlin, Germany. It combines the activities of a music publisher and a record label. BMG was founded in October 2008 after Bertelsmann sold i ...

, selling its 51% stake to

Bertelsmann Bertelsmann SE & Co. KGaA () is a German private multinational conglomerate corporation based in Gütersloh, North Rhine-Westphalia, Germany. It is one of the world's largest media conglomerates, and is also active in the service sector and ...

. In January 2014, KKR acquired Sedgwick Claims Management Services Inc for $2.4 billion from two private equity companies - Stone Point, and

Hellman & Friedman Hellman & Friedman LLC (H&F) is an American private equity firm, founded in 1984 by Warren Hellman and Tully Friedman, that makes investments primarily through leveraged buyouts as well as growth capital investments. H&F has focused its efforts ...

. In June 2014, KKR announced it was taking a one-third stake in a Spanish energy business of

Acciona Energy Acciona, S.A. () is a Spanish multinational conglomerate dedicated to the development and management of infrastructure (construction, water, industrial and services) and renewable energy. The company, via subsidiary Acciona Energy, produces 21 te ...

, at a cost of €417 million ($567 million). The international renewable energy generation business operates renewable assets, largely

wind farm A wind farm or wind park, also called a wind power station or wind power plant, is a group of wind turbines in the same location used to produce electricity. Wind farms vary in size from a small number of turbines to several hundred wind turb ...

s, across 14 countries including the

United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country Continental United States, primarily located in North America. It consists of 50 U.S. state, states, a Washington, D.C., ...

Italy Italy ( it, Italia ), officially the Italian Republic, ) or the Republic of Italy, is a country in Southern Europe. It is located in the middle of the Mediterranean Sea, and its territory largely coincides with the homonymous geographical ...

and

South Africa South Africa, officially the Republic of South Africa (RSA), is the southernmost country in Africa. It is bounded to the south by of coastline that stretch along the South Atlantic and Indian Oceans; to the north by the neighbouring coun ...

. In August 2014, KKR announced it was investing $400 million to acquire Fujian Sunner Development, China's largest chicken farmer, which breeds, processes and supplies frozen and fresh chickens to consumers and corporate clients, such as KFC and McDonald's, across China. In September 2014, the firm invested $90 million in a lighting and electrics firm

Savant Systems Savant Systems Inc. is a home automation company headquartered in Hyannis, Massachusetts, United States. The company was founded in 2005 and is privately held. It has 200 employees at its headquarters and a further 700 through its subsidiary GE ...

. Also in 2014, KKR acquired commercial landscaping company ValleyCrest from Michael Dell’s investment firm

MSD Capital MSD Capital is an American private Investment company, investment firm that manages the capital of Michael Saul Dell, Michael Dell and his family. The firm, which is based in New York City, New York and has offices in Santa Monica and West Palm B ...

, and combined it with landscape company Brickman, which it had owned since 2013, to form BrightView. In January 2015, KKR confirmed its purchase of the British rail ticket website

thetrainline.com Trainline (formerly Thetrainline.com) is an international digital rail and coach technology platform with headquarters in London. It sells train tickets and railcards as well as providing free access to live train times and railway station inf ...

, previously owned by Exponent. The purchase sum is unknown. On October 12, 2015, KKR announced that it has entered into definitive agreement with Allianz Capital Partners to acquire their majority stake in Selecta Group, a European vending services operator. In 2016, KKR purchased two Hispanic chains, Northern California Mi Pueblo and

Ontario, California Ontario is a city in southwestern San Bernardino County in the U.S. state of California, east of downtown Los Angeles and west of downtown San Bernardino, the county seat. Located in the western part of the Inland Empire metropolitan area, i ...

–based Cardenas. In February 2016, KKR invested $75 million in commercial real estate lender A10 Capital. On September 1, 2016, KKR announced that it had acquired Epicor Software Corporation, an American software company. In October 2016, it was reported that KKR invested $250 million in OVH to be used for further international expansion. This funding round valued OVH at over $1 billion, making it a

unicorn The unicorn is a legendary creature that has been described since antiquity as a beast with a single large, pointed, spiraling horn projecting from its forehead. In European literature and art, the unicorn has for the last thousand years o ...

. In December 2016, the

Lonza Group Lonza Group is a Swiss multinational manufacturing company for the pharmaceutical, biotechnology and nutrition sectors, headquartered in Basel, with major facilities in Europe, North America and South Asia. Lonza was established under that name ...

announced it would acquire

Capsugel Capsugel is a company that manufactures and sells two-piece hard gelatin drug capsules. Note: two of the four authors of Chapter 28 were Capsugel employees. Also cited is "Summary and Implications (Chapter 34), by the editors of the book. Caps ...

for $5.5 billion from Kohlberg Kravis Roberts. In February 2017, KKR was reported to be trying to take over the international market research company ARI GfK SE. In July 2017, KKR acquired WebMD Health Corp for $2.8 billion and, the following month, it acquired

PharMerica PharMerica is a Fortune 1000 company formed in January 2007 from the merger of Kindred Healthcare's pharmacy business with a subsidiary of AmerisourceBergen. The company is headquartered in Louisville, Kentucky, and operates a major customer sup ...

for $1.4 billion including debt, Pepper Group for $518 million, Covenant Surgical Partners, and Envision Healthcare Corporations ambulance business for $2.4 billion. On July 6, 2017, KKR announced it would merge Northern California Mi Pueblo and Ontario-based Cardenas Market. On September 18, 2017, Toys "R" Us, Inc. filed for

Chapter 11 bankruptcy Chapter 11 of the United States Bankruptcy Code ( Title 11 of the United States Code) permits reorganization under the bankruptcy laws of the United States. Such reorganization, known as Chapter 11 bankruptcy, is available to every business, whe ...

, stating the move would give it flexibility to deal with $5 billion in long-term debt, borrow $2 billion so it can pay suppliers for the upcoming holiday season and invest in improving current operations. In mid-July 2018, KKR purchased RBMedia, one of the largest independent publishers and distributors of

audiobook An audiobook (or a talking book) is a recording of a book or other work being read out loud. A reading of the complete text is described as "unabridged", while readings of shorter versions are abridgements. Spoken audio has been available in sc ...

s. On July 22, 2018, KKR & Co. announced it is taking over Taipei-based LCY Chemical Corp. in a deal valued at NT$47.8 billion ($1.56 billion US), part of a plan for more transactions involving controlling stakes in the Greater China region. In July 2018, it was announced that KKR sold Gallagher Shopping Park, West Midlands in the UK to South Korean investors, Hana for £175 million. In February 2019, KKR acquired the German media company

Tele München Gruppe Leonine Holding GmbH, LLC, formerly Tele München Group, LLC (German: Tele München Gruppe; TMG), is a media company based in Munich. The activities of Leonine include trade in licenses, investments in television and radio stations and distribu ...

. Later that month, KKR acquired German film distributor Universum Film GmbH. In July 2019, KKR acquired the Canadian software company

Corel Cascade Parent Limited, doing business as Alludo (pronounced like "all you do"), is a Canadian software company headquartered in Ottawa, Ontario, specializing in graphics processing. Formerly called the Corel Corporation ( ; from the abbreviat ...

. In August 2019, KKR acquired Arnott's, the Australian snack unit of

Campbell Soup Company Campbell Soup Company, trade name, doing business as Campbell's, is an American processed food and snack company. The company is most closely associated with its flagship canned soup products; however, through mergers and acquisitions, it has gro ...

, for $2.2 billion. Later that month, KKR became the biggest shareholder of German media group

Axel Springer Axel Cäsar Springer (2 May 1912 – 22 September 1985) was a German publisher and founder of what is now Axel Springer SE, the largest media publishing firm in Europe. By the early 1960s his print titles dominated the West German daily press ma ...

, paying $3.2 billion for a 43.54% stake. In December 2019, KKR, together with

Alberta Investment Management Corporation Alberta Investment Management Corporation (AIMCo) is an Albertan Crown corporation and institutional investor established to manage several public funds and pensions headquartered in Edmonton, Alberta. AIMCo was established by an act of the Legi ...

, acquired a 65% stake in the controversial

Coastal GasLink pipeline The Coastal GasLink pipeline is a TC Energy natural gas pipeline under construction in British Columbia, Canada. Starting in Dawson Creek, the pipeline's route crosses through the Canadian Rockies and other mountain ranges to Kitimat, where t ...

project, from

TC Energy TC Energy Corporation (formerly TransCanada Corporation) is a major North American energy company, based in the TC Energy Tower building in Calgary, Alberta, Canada, that develops and operates energy infrastructure in Canada, the United States, ...

. The pipeline route crosses the territory of the Wet'suwet'en Nation, which opposes the project. Enforcement of an injunction to build through the Wet'suwet'en territory has sparked widespread protests across Canada. In the final days of 2019, KKR announced it would acquire

OverDrive, Inc. OverDrive, Inc. is a digital distributor of eBooks, audiobooks, online magazines and streaming video titles. The company provides digital rights management and download fulfillment services for publishers, libraries, schools, corporations and b ...

, a major distributor of

eBooks An ebook (short for electronic book), also known as an e-book or eBook, is a book publication made available in digital form, consisting of text, images, or both, readable on the flat-panel display of computers or other electronic devices. Alt ...

to libraries. The potential for consolidation with KKR subsidiary RBMedia was quickly noted in the library and publishing industry; the acquisition was finalized in June 2020. In May 2020, KKR announced that it will be investing $750 million in cosmetics producer

Coty, Inc. Coty Inc. is an American-French multinational beauty company founded in 1904 by François Coty. With its subsidiaries, it develops, manufactures, markets, and distributes fragrances, cosmetics, skin care, nail care, and both professional and reta ...

A separate plan was revealed in which several divisions of Coty are set to be spun out into a new company. According to the deal, KKR will own 60%, while Coty 40% of the new business. The same month, it was announced that KKR is set to make an investment into Indian digital company

Jio Platforms Jio Platforms is an Indian multinational technology company, headquartered in Mumbai. It is a subsidiary of Reliance Industries. Established in 2019, it acts as a holding company for India's largest mobile network operator Jio and other dig ...

. It was reported that KKR was negotiating to buy a $1.5bn stake of a maximum value reach of $65bn for Jio Platforms. In late June 2020, KKR announced it would lead a $48 million funding round for Artlist, a provider of royalty-free music, sound effects and video. Despite the

COVID-19 pandemic The COVID-19 pandemic, also known as the coronavirus pandemic, is an ongoing global pandemic of coronavirus disease 2019 (COVID-19) caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2). The novel virus was first identi ...

, the company reported a profit of $16 billion in the Q2 for 2020. In August 2020, it was reported that KKR was preparing to sell its Epicor Software Corp. branch. On August 31, it was officially confirmed that a group primary represented by private-equity firm

Clayton, Dubilier & Rice Clayton, Dubilier & Rice is an American private equity company. It is one of the oldest private equity investment firms in the world. Founded in 1978, CD&R has managed the investment of more than $30 billion in approximately 90 businesses, repre ...

is set to buy the branch in a deal worth $4.7 billion. The acquisition was one of the largest purchases of 2020. In September 2020, KKR announced an investment of $755 million in the retail arm of India-based Reliance Industries Ltd. In November 2020, KKR teamed up with

Rakuten () is a Japanese technology conglomerate based in Tokyo, founded by Hiroshi Mikitani in 1997. Centered around Rakuten Ichiba, its businesses include financial services utilizing financial technology, as well as digital content and communicati ...

to acquire 85% of

Seiyu Voice acting in Japan is an industry where actors provide voice-overs as characters or narrators in media including anime, video games, audio dramas, commercials, and dubbing for non-Japanese films and television programs. In Japan, and a ...

, the Japanese nationwide retail chain owned by

Walmart Walmart Inc. (; formerly Wal-Mart Stores, Inc.) is an American multinational retail corporation that operates a chain of hypermarkets (also called supercenters), discount department stores, and grocery stores from the United States, headquarter ...

. In January 2021, KKR acquired a majority stake in the catalogue of American musician

Ryan Tedder Ryan Tedder (born June 26, 1979) is an American singer, songwriter, and record producer. As well as being the lead vocalist of the pop rock band OneRepublic, he has an independent career as a songwriter and producer for various artists since th ...

, including his band

OneRepublic OneRepublic is an American pop rock band formed in Colorado Springs, Colorado, in 2002. It consists of lead vocalist and multi-instrumentalist Ryan Tedder, lead guitarist and violist Zach Filkins, rhythm guitarist Drew Brown (musician), Drew Bro ...

and the songs that he composed for other artists since 2016. In November 2021, KKR disposed of Audiobooks.com to streaming company Storytel for $135 million; later that same month, KKR and Global Infrastructure Partners announced they would acquire

CyrusOne CyrusOne owns and operates over 40 carrier-neutral data centers in North America, Europe, and South America, where it provides colocation and peering services. It is headquartered in Dallas, Texas and is owned by funds managed by Kohlberg Kravis ...

for $15 billion. In February 2022, it was reported by

Bloomberg Bloomberg may refer to: People * Daniel J. Bloomberg (1905–1984), audio engineer * Georgina Bloomberg (born 1983), professional equestrian * Michael Bloomberg (born 1942), American businessman and founder of Bloomberg L.P.; politician and m ...

that Saudi Arabian Public Investment Fund had purchased just over a 5% stake in

Capcom is a Japanese video game developer and publisher. It has created a number of multi-million-selling game franchises, with its most commercially successful being '' Resident Evil'', '' Monster Hunter'', '' Street Fighter'', ''Mega Man'', ''De ...

and Nexon, reportedly worth $883 USD million, while KKR acquired 8.5% of Nexon, the Japanese-South Korean video game company. In April 2022, KKR announced the signing of an agreement to purchase

Barracuda Networks Barracuda Networks, Inc. is a company providing security, networking and storage products based on network appliances and cloud services. The company's security products include products for protection against email, web surfing, web hackers ...

from

Thoma Bravo Thoma Bravo, LP, is an American private equity and growth capital firm with offices in San Francisco, Chicago and Miami. It is known for being particularly active in acquiring software companies and has over $114 billion in assets under manage ...

, which closed in August that year; later that same month, KKR announced it had acquired all shares of Mitsubishi UBS Realty, a Japanese real estate asset manager. In May 2022,

Business Wire Business Wire is an American company that disseminates full-text press releases from thousands of companies and organizations worldwide to news media, financial markets, disclosure systems, investors, information web sites, databases, bloggers, ...

reported that KKR led about $200 million investment round in Semperis, a cybersecurity company focused on identity protection. Shortly after, Crunchbase listed Semperis as a privacy & security

. Although the company's valuation has not been publicly confirmed, news outlets such as SecurityWeek, Enterprise Times, and SC Media concur this funding round puts Semperis in unicorn territory. In June 2022, it was announced that KKR would sell Cardenas to funds affiliated with

Apollo Global Management Apollo Global Management, Inc. is an American global private-equity firm. It provides investment management and invests in credit, private equity, and real assets. As of March 31, 2022, the company had $512 billion of assets under management, ...

for an undisclosed amount.

Partners

Over the years, many of KKR's original partners have departed, the most notable being co-founder Jerome Kohlberg. After a leave of absence due to illness in 1985, Kohlberg returned to find increasing differences in strategy with his partners, Kravis and Roberts. In 1987, Kohlberg left KKR to found a new private equity firm,

Kohlberg & Company Kohlberg & Company is an American private equity firm that focuses on leveraged buyout transactions. Founded by investor Jerome Kohlberg, Jr., the firm invests in a variety of transactions including leveraged carveout, take-private transactions, ...

, which resumed the investment style that Kohlberg had practiced at

and in KKR's earlier years, acquiring smaller,

middle-market companies Authorities provide differing definitions of the middle-market or mid-market companies. While some authorities look to revenue generated by companies to define the middle market, other sources regard either asset size or number of employees as a be ...

. Since 1996, general partners of KKR have included

, Paul Raether, Robert MacDonnell, Jose Gandarillas, Michael Michelson, Saul Fox, James H. Greene, Jr., Michael Tokarz, Clifton S. Robbins, Scott Stuart, Perry Golkin and Edward Gilhuly. Among those who left were Saul Fox,

Ted Ammon Robert Theodore Ammon (August 30, 1949 – October 20, 2001) was an American financier and investment banker. Born in Pittsburgh, Pennsylvania, he was murdered in his home in 2001 by electrician Daniel Pelosi, who was convicted in 2004. Ammon ...

, Ned Gilhuly, Mike Tokarz and Scott Stuart who had been instrumental in establishing KKR's reputation and track record in the 1980s. KKR remains tightly controlled by Kravis and Roberts. The issue of succession has remained an important consideration for KKR's future. * Scott C. Nuttall (born 1972) formerly headed KKR's fastest-growing department, the Global Capital and Asset Management Group. He joined KKR in November 1996 after leaving the

. With the support of co-founder George Roberts, Nuttall spearheaded the campaign to transform KKR from a private equity firm into an investment firm after noting lost opportunities amounting to billions of dollars that the company had had to turn down. He also has served on the board of

Fiserv Fiserv, Inc. () is an American multinational company headquartered in Brookfield, Wisconsin that provides financial technology services to clients across the financial services sector, including: banks, thrifts, credit unions, securities broker ...

(a financial services firm) since it acquired, for $22 billion, in 2019, the KKR-backed First Data Corp. Nuttall was named co-President and co-COO, with Joseph Bae, on July 17, 2017, responsible for the day-to-day operations of the firm, concentrating on KKR's corporate and real estate credit, capital markets, hedge fund and capital raising businesses together with the firm's corporate development, balance sheet, and strategic growth initiatives. ''

The New York Times ''The New York Times'' (''the Times'', ''NYT'', or the Gray Lady) is a daily newspaper based in New York City with a worldwide readership reported in 2020 to comprise a declining 840,000 paid print subscribers, and a growing 6 million paid ...

'' called Nuttall and Joseph Bae potential successors to the firm's founders. In 2021, he was promoted to co-CEO. He graduated, summa cum laude, from the

Wharton School of the University of Pennsylvania The Wharton School of the University of Pennsylvania ( ; also known as Wharton Business School, the Wharton School, Penn Wharton, and Wharton) is the business school of the University of Pennsylvania, a private Ivy League research university in ...

with a

Bachelor of Science A Bachelor of Science (BS, BSc, SB, or ScB; from the Latin ') is a bachelor's degree awarded for programs that generally last three to five years. The first university to admit a student to the degree of Bachelor of Science was the University o ...

degree. * Joseph Bae (born 1972) joined KKR from

in 1996. Most recently, he was the managing partner of KKR Asia and the global head of KKR's Infrastructure and Energy Real Asset businesses. Mr. Bae has been the architect of KKR's Asian expansion since 2005. He has been named co-president and co-chief operating officer with Scott Nuttall on July 17, 2017, to be responsible for the day-to-day operations of the firm. Bae focuses on KKR's global private equity businesses as well as the Firm's real asset platforms across energy, infrastructure, and real estate private equity. In 2021, he was promoted to co-CEO. He graduated with a

Bachelor of Arts Bachelor of arts (BA or AB; from the Latin ', ', or ') is a bachelor's degree awarded for an undergraduate program in the arts, or, in some cases, other disciplines. A Bachelor of Arts degree course is generally completed in three or four yea ...

degree from

Harvard College Harvard College is the undergraduate college of Harvard University, an Ivy League research university in Cambridge, Massachusetts. Founded in 1636, Harvard College is the original school of Harvard University, the oldest institution of higher ...

. * Alexander Navab (1965 – 2019) joined KKR from

in 1993 and was the former head of Americas Private Equity. After spending 24 years at the firm, he stepped down as part of the Nuttall-Bae transition and would retire. In September 2017, he was elected to

Columbia University Columbia University (also known as Columbia, and officially as Columbia University in the City of New York) is a private research university in New York City. Established in 1754 as King's College on the grounds of Trinity Church in Manhatt ...

's board of trustees. He was born in

Isfahan Isfahan ( fa, اصفهان, Esfahân ), from its ancient designation ''Aspadana'' and, later, ''Spahan'' in middle Persian, rendered in English as ''Ispahan'', is a major city in the Greater Isfahan Region, Isfahan Province, Iran. It is lo ...

Iran Iran, officially the Islamic Republic of Iran, and also called Persia, is a country located in Western Asia. It is bordered by Iraq and Turkey to the west, by Azerbaijan and Armenia to the northwest, by the Caspian Sea and Turkmeni ...

, but followed his family and became a refugee in Greece following the

Iranian Revolution The Iranian Revolution ( fa, انقلاب ایران, Enqelâb-e Irân, ), also known as the Islamic Revolution ( fa, انقلاب اسلامی, Enqelâb-e Eslâmī), was a series of events that culminated in the overthrow of the Pahlavi dyna ...

. They immigrated to the United States two years later. He received a bachelor of arts degree from

Columbia College, Columbia University Columbia College is the oldest undergraduate college of Columbia University, situated on the university's main campus in Morningside Heights in the borough of Manhattan in New York City. It was founded by the Church of England in 1754 as King' ...

, and an

MBA A Master of Business Administration (MBA; also Master's in Business Administration) is a postgraduate degree focused on business administration. The core courses in an MBA program cover various areas of business administration such as accounti ...

degree from

Harvard Business School Harvard Business School (HBS) is the graduate business school of Harvard University, a private research university in Boston, Massachusetts. It is consistently ranked among the top business schools in the world and offers a large full-time MBA ...

. In 2016, he was honored with

Ellis Island Medal of Honor The Ellis Island Medal of Honor is an American award founded by the Ellis Island Honors Society (EIHS) (formerly known as the National Ethnic Coalition of Organizations (NECO)), which is presented annually to American citizens, both native-born a ...

. He died in July 2019 at age 53. * Saul A. Fox left KKR in 1997 to found

Fox Paine & Company Fox Paine & Company is a private equity firm focused on leveraged buyout transactions. Fox Paine & Company, LLC was founded in 1996 by former Kohlberg Kravis Roberts partner Saul A. Fox. Former Kohlberg & Co. partner W. Dexter Paine III was br ...

, a middle market private equity firm with over $1.5 billion of capital under management Anders, George
"Bitter End of a Partnership"
''

Wall Street Journal ''The Wall Street Journal'' is an American business-focused, international daily newspaper based in New York City, with international editions also available in Chinese and Japanese. The ''Journal'', along with its Asian editions, is published ...

'', September 15, 2007. * Clifton S. Robbins left KKR to join competitor

General Atlantic Partners General Atlantic (also known as "GA") is an American growth equity firm providing capital and strategic support for global growth companies, headquartered in New York, United States. The firm was founded in 1980 as the captive investment team for ...

in 2000 and later founded Blue Harbour Group, a private investment firm based in

Greenwich, Connecticut Greenwich (, ) is a town in southwestern Fairfield County, Connecticut, United States. At the 2020 census, the town had a total population of 63,518. The largest town on Connecticut's Gold Coast, Greenwich is home to many hedge funds and othe ...

.Barbarians at the Gate: Contrasting fortunes for those closest to the deal
eFinancial News, November 3, 2008; retrieved February 16, 2009. * Edward A. Gilhuly and Scott Stuart left KKR in 2004 to launch

Sageview Capital Sageview Capital is an American investment firm that raised over $2.0 billion in capital across three investment vehicles. The firm provides capital to technology-enabled businesses. History The firm was founded by two former members of the Kohlb ...

. Prior to this, Gilhuly was the managing partner of KKR's London-based European operations. Stuart had managed KKR's energy and consumer products industry groups. *

, started several new ventures including Big Flower Press, which printed newspaper circulars, and Chancery Lane Capital, a boutique private equity firm, before being murdered in his

Long Island Long Island is a densely populated island in the southeastern region of the U.S. state of New York, part of the New York metropolitan area. With over 8 million people, Long Island is the most populous island in the United States and the 18 ...

home October 2001. The lover of his estranged, now deceased wife, Generosa, was later convicted. * Paul Hazen, served as chairman and CEO of

Wells Fargo Wells Fargo & Company is an American multinational financial services company with corporate headquarters in San Francisco, California; operational headquarters in Manhattan; and managerial offices throughout the United States and intern ...

(1995–2001). Hazen later returned to KKR to serve as chairman of

Accel-KKR Accel-KKR is an American technology-focused private equity firm with over $14 billion in total assets under management. The firm invests primarily in middle-market software and technology-enabled services businesses, providing capital for buyo ...

, a joint venture with

Accel Partners Accel, formerly known as Accel Partners, is an American venture capital firm. Accel works with startups in seed, early and growth-stage investments. The company has offices in Palo Alto, California and San Francisco, California, with additional ...

, and later as chairman of KKR's publicly listed affiliate, KFN. * Clive Hollick, Baron Hollick, CEO of

United News and Media UBM plc was a British business-to-business (B2B) events organiser headquartered in London, England, before its acquisition by Informa in 2018. It had a long history as a multinational media company. Its main focus was on B2B events, but its pr ...

(1996–2005) *

Ken Mehlman Kenneth Brian Mehlman (born August 21, 1966) is an American social entrepreneur and businessman. He serves as a member, global head of public affairs, and co-head of KKR global impact at investment firm Kohlberg Kravis Roberts. He oversees the fir ...

joined KKR in 2008 as global head of public affairs. *

David Petraeus David Howell Petraeus (; born November 7, 1952) is a retired United States Army general and public official. He served as Director of the Central Intelligence Agency from September 6, 2011, until his resignation on November 9, 2012. Prior to ...

, selected to serve as chairman of the newly formed KKR Global Institute (2013—present) * Joseph Grundfest, professor at

Stanford Law School Stanford Law School (Stanford Law or SLS) is the law school of Stanford University, a private research university near Palo Alto, California. Established in 1893, it is regarded as one of the most prestigious law schools in the world. Stanford La ...

and youngest SEC Commissioner *

Malcolm Turnbull Malcolm Bligh Turnbull (born 24 October 1954) is an Australian former politician and businessman who served as the 29th prime minister of Australia from 2015 to 2018. He held office as leader of the Liberal Party of Australia. Turnbull grad ...

, former Prime Minister of Australia; commenced 1 June 2019.

Works about KKR

* * * *

Notes

References

FT.com / Industries / Basic industries – "KKR set to buy Masonite for C$3.1bn"
* Gross, Daniel & David Sterling.
Has Henry Kravis gone soft?
. ''Slate'', August 5, 2007; retrieved August 7, 2007.
The KKR Way
Bloomberg Markets, August 2007
"The barbarians at the gate have been losing their Midas touch"
timesonline.co.uk, August 6, 2005; retrieved February 16, 2009.

External links

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