KKR to acquire KKR Financial in all-stock deal

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Associated Press

Posted on December 16, 2013 at 6:00 PM

Updated Monday, Dec 16 at 6:02 PM

Global investment firm Kohlberg Kravis Roberts & Co. L.P. says it plans to acquire KKR Financial Holdings LLC in an all-stock agreement that values the specialty finance company at $2.6 billion.

KKR Financial, based in San Francisco, is already managed by the New York-based private equity investment firm but operates as a separate company.

Under the agreement announced Monday, KKR Financial shareholders will receive 0.51 common units of KKR & Co. for each common share they hold. This represents a stock payment of $12.79 per share to KKR Financial shareholder. That's a 35 percent premium to its own closing price Monday.

The deal expands KKR & Co.'s assets and is expected to immediately boost its earnings. The companies expect the deal to close in the first half of 2014.

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