KKR Closes $1B Mezz Fund, Its First

Firm: Kohlberg Kravis Roberts & Co.

Fund: KKR Mezzanine Partners I

Target: $1 billion

Since its founding in 1976 the New York buyout firm Kohlberg Kravis Roberts & Co. has undertaken billions of dollars worth of transactions, but it now has done something it never did before, raising a mezzanine fund.

KKR Asset Management announced Sept. 16 that it had held the final close of its more than $1 billion mezzanine fund, KKR Mezzanine Partners I, according to sister service Thomson Reuters LPC, which tracks the loan market.

The fund, which closed on Aug. 31, raised capital from a diverse group of global investors, including insurers, pension plans, family offices and sovereign pools of capital, KKR said. “We have a healthy pipeline of opportunities and look forward to putting this additional capital to work by continuing to partner with private equity sponsors and management teams to support their objectives,” said Frederick Goltz, head of KKR’s mezzanine business, in a press release announcing the fund’s close.

Recent transactions include providing the mezzanine financing that facilitated Advent International Corp.‘s and Bain Capital Partners‘s acquisition of payment processor RBS WorldPay, Bain Capital Partners’s acquisition of chemical distributor IMCD Group and supporting the sale of Kroll Inc to Altegrity Inc, an international screening and security solutions company owned by Providence Equity Partners, the statement said.

Launched by KKR in 2004, KKR Asset Management invests on behalf of its managed funds, clients and accounts across long/short equities and the corporate credit spectrum, including secured credit, bank loans and high yield securities and alternative assets such as mezzanine financing, distressed investing and structured finance.

A call to KKR was not immediately returned.

(Leela Parker is a correspondent for Thomson Reuters LPC in New York.)