Couldn't find a KKR thread. So, i'll post it here.
If Moderators could be kind enough to "move" this thread to the "investment topics" basket .. and re-name it as KKR, that would be awesome.
Here is a great 45 min long with Mr. Kravis from KKR. Seems like a passionate person. I like that. I had listened to interviews with the head of Apollo Management, i did not like the guy. But Mr. Kravis seem like my kind of a leader, based on the optics.
Interview is great.
https://www.bloomberg.com/news/articles/2020-10-30/kravis-says-the-market-is-wilder-than-at-any-time-in-his-careerI don't follow the name closely. Found out in the interview that KKR had recently (July 2020) bought Global Atlantic with its own balance sheet to add to its 'permanent capital'. i.e. not an investment through its funds. Interesting both KKR and BAM are going there in the insurance space.
Looking at the post from 2009 that started this thread, it is interesting to see that Kravis had this Berkshire "permanent capital" in the back of his mind for a long time. Perhaps it is time for me to read the long over due "Barbarian at the Gates", not that it helps with today's KKR, but i like to read on company's DNAs.
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https://www.bnnbloomberg.ca/kkr-to-buy-global-atlantic-adding-almost-90-billion-in-assets-1.1462201(Bloomberg) -- KKR & Co. agreed to buy Global Atlantic Financial Group in a deal that gives it a major presence in the insurance industry and adds long-term capital.
The alternative-investment manager will acquire Global Atlantic’s outstanding shares, according to a statement released Wednesday, in a transaction that could be valued at more than $4 billion. Global Atlantic, which was founded within Goldman Sachs Group Inc. in 2004 and became independent in 2013, had more than 2 million policyholders through its retirement and life insurance products and almost $90 billion in assets as of March 31.
KKR’s rivals have been building out their own insurance arms in recent years and have brought on executives who can help them attract more business. Insurers are facing historically low yields in fixed-income markets. Apollo Global Management Inc. helped turn annuity seller Athene Holding Ltd. into a business with a market value of $5.8 billion, and funds affiliated with Blackstone Group Inc. teamed up with other investors in 2017 to buy Fidelity & Guaranty Life.
“This is a transformative event for KKR,” said Henry Kravis and George Roberts, co-chief executive officers of the New York-based firm. “Our businesses are complementary and our partnership will benefit all of our collective stakeholders.”
KKR will pay the insurer’s book value at the date of closing, subject to an “equity roll-over” for certain existing shareholders, according to the statement. Global Atlantic’s book value was about $4.4 billion at the end of March.
‘Permanent Capital’
The purchase is expected to be completed in early 2021. Global Atlantic will then operate as a separate business with its current management team, headed by CEO Allan Levine.
KKR already manages $26 billion of assets on behalf of insurers. The deal also increases what private equity firms refer to as “permanent capital,” coveted funds they don’t have to give back to investors in a few years.
Global Atlantic offers annuities for individuals through banks, broker-dealers and insurance agencies as well as life insurance. The company is also in the reinsurance business for life and annuity clients.
KKR expects to fund the acquisition, net of the equity roll-over, from a combination of cash, proceeds from potential minority co-investors and the issuance of new debt or equity.