The alternative asset manager reported more than US$725mil in realised investment and performance income. — Reuters
NEW YORK: KKR & Co notched a double-digit increase in profit from selling assets during the fourth quarter (4Q) amid broader signs of improving conditions for private equity dealmaking.
The alternative asset manager reported more than US$725mil in realised investment and performance income, including carried interest, for the period between Oct 1 and Dec 17, the firm said in a statement.
That total represents a 45% increase from a roughly equivalent period a year earlier, when KKR reported more than US$500mil in profits.
Those gains were driven by secondary sales and strategic transactions, dividends and interest income, as well as fees from Marshall Wace, the London-based hedge fund KKR holds a stake in, the firm said. Realised carried interest made up more than half of the profit.
Private equity firms have signalled that better days may be ahead for selling assets after more than two years of slower dealmaking due to higher borrowing costs.
Rate cuts from the Federal Reserve have contributed to more positive sentiment across markets.
“We’ve seen an uptick here given readily accessible debt markets, the improved tone across global equity markets and increased mergers and acquisitions volumes,” chief financial officer Robert Lewin said on the firm’s 3Q earnings call.
“As we look ahead, presuming the market backdrop remains constructive, we expect you’ll see a further acceleration of activity across the industry.” — Bloomberg
