KKR raises $250m for ‘real assets’

The private equity firm’s ‘real assets’ funds include infrastructure and natural resources. KKR head of global capital markets and asset management Scott Nuttall said the firm raised the money during the first quarter of 2010.

Kohlberg Kravis Roberts has given the first public indication of fundraising success for its debut infrastructure fund.

Scott Nuttall, head of the firm’s global capital markets and asset management group, said in a quarterly conference call last week the firm has collected about $250 million during the first quarter for its “real assets” funds. These include infrastructure and natural resources, Nuttall said.

“We're seeing increasing interest in these types of products,” he added.

KKR has been raising its debut infrastructure fund since early 2009. As of March, it had yet to hold a first close. Nuttall’s remark during the conference call was the first public indication that the fund, targeting between $2 billion and $4 billion, is finally getting traction among investors. 

On the natural resources front, KKR in February announced a partnership with Premier Natural Resources, an oil and gas exploration company, to jointly pursue investment opportunities in the North American oil and gas sector.  The partnership is overseen by KKR’s Marc Lipschultz, who serves as the firm’s global head of energy and infrastructure.

In early May, Dow Jones reported that KKR would soon be launching a $900 million fund for the oil and gas sector. Dow Jones also reported that the fund had secured a $250 million commitment from the Teacher Retirement System of Texas.

KKR continues to raise capital for other funds, including a mezzanine fund, which held a first close on an undisclosed amount in the first quarter. The firm raised a total of $415 million for its mezzanine, oil and gas and capital markets strategies funds, Nuttall said.

KKR’s assets under management increased $2.1 billion to $40.9 billion in the first quarter from the reporting period that ended 31 December. The increase was due “primarily” to a rise in the fair value of the firm’s private equity portfolio.

The firm earned less in fees in the first quarter, collecting about $56.2 million, compared to the fourth quarter of 2009, when the firm brought in $69.2 million. The decrease occurred in part because KKR collected a $46.1 million termination payment on a monitoring agreement with a portfolio company in the fourth quarter, which boosted fee earning income in that quarter by about $28.6 million.