KKR strikes partnership with KDB(4)

Kohlberg Kravis Roberts has formed an investment agreement with state-owned Korea Development Bank (KDB), according to KDB’s website.

The partnership will help advance the local private equity market, Cho Hyun-ik, a KDB executive director, said in a statement. KKR would be a “long-term investor” in Korea, added Joseph Bae, a managing partner at KKR Asia, the firm’s Asia operations. 

Earlier this month, KKR acquired South Korean brewery Oriental Brewery for $1.8 billion from Anheuser-Busch InBev. If completed, the deal will likely be one of the largest buyouts in 2009 not only in Asia Pacific but also in the world.

KDB is close to setting up a W1 trillion ($797 million; €571 million) corporate restructuring fund, according to a report in Korea’s JoongAng Daily in April. The fund is reportedly aimed at giving small and medium-sized companies struggling from financial woes in the recession a chance to revive. The bank will initially contribute W100 billion to the fund and private equity funds will be asked to join in and raise the remaining amount, the report noted.

KDB has four main businesses: corporate banking, investment banking, international banking and corporate restructuring and consulting. The bank invests in private equity funds and primarily in direct venture capital. It does not invest in fund of funds. KDB has no limitations on its investment appetite, according to sister private equity database PE Connect.

KDB and KKR did not respond to requests for comment at press time.