KKR Edges Towards IPO

by Stewart Douglas

Story link: KKR Edges Towards IPO

American private equity group KKR suggested today that it was to proceed with its previous goal of launching its initial public offering, despite the fact that securities markets worldwide have been shaken in recent months as a result of the summer sub-prime collapse.

The privately held firm, run by investment managers George Roberts and Henry Kravis, has today spoken of its intention to float indirectly through updating its information with offering regulators to include its most recent results, which could suggest that the firm is about to launch its IPO in the near future.

The results filed reflected an increase in net investment income of over a quarter, up to $667 million from the results filed last time around.  It is thought that the firm has delayed its IPO over the last few months as a result of the market climate, which could have wiped substantial value from its shares without any internal justification, which would sacrifice control held by its owners and dilute decision making at an indesirably low price.

Its net capital gains (gains less acquisition costs and allowable expenses) were up to $3.1 billion, almost double results over the previous period from the same business.  The company derives revenue from both investment income, largely through share dividends from held entities, and from capital disposals of its book holdings.

KKR has enjoyed a particular busy year, acquiring several notable high profile targets throughout the course of the first three quarters, despite the fact that many other investment and venture firms have backed out of deals in relation to hidden sub-prime exposure, leading to a raft of litigation and debate within the industry.

As a result, its long anticipated IPO is thought to still take place over the course of this year, despite the fact that markets across the world have been deeply unsettled by reverberations from the US and the collapse of the sub-prime mortgage sector.

The firms has today added further fuel to the fir, yet it continues to reserve comment on the speculation that it is fast approaching an IPO move.