Kohlberg Kravis Roberts has closed its global buyout fund, dubbed KKR 2006, on approximately $17.6 billion (€11.2 billion), according to a source close to the buyout firm.
The fund has been marketed for at least two years and has garnered commitments from limited partners including the Oregon Investment Council, the Pennsylvania State Employees' Retirement System and KKR Private Equity Investors, the buyout firm's Euronext-listed investment fund.
KKR 2006 will invest primarily in large cap companies in North American and European markets, making equity investments ranging from $150 million to $600 million, according to January 2006 minutes from the Oregon pension.
The fundraising takes the total funds the firm has raised to more than $40 billion across its funds since the 1990s. The firm has grown its assets under management from $18.3 billion in December 2002 to $53.4 billion in the third quarter of 2007 at a CAGR of 28.7 percent, the source said.
Anecdotally, investors have recently been turning to mid-market managers, who they believe are less reliant on leverage for their deals. US alternative investment firm The Blackstone Group has delayed the first close of its $20 billion (€12.6 billion) fundraising from April to June, according to trade newsletter Private Equity Insider.
But an investor in Blackstone’s fund said any delay would be insignificant to Blackstone. “Blackstone doesn’t need to wait. It’s simply, like most buyout firms, they have a large investor base and higher complexity to deal with all the different legal paperwork.”
He said firms like CVC Capital Partners and TPG Capital are actively working on their planned funds. “TPG’s global fund could be above $20 billion and they have already got past $10 billion,” he said. CVC’s European fundraising effort had been thought to be closing as high as €12.1 billion, a European record, but it is now understood that it may close lower than this total but at €11 billion in the first half, according to an investor in the firm.
Apax Partners is also understood to have reached its €10 billion target for its latest European fundraising last year, but it has postponed a final close to allow its investor base to complete its documentation.