KKR raises $3.35B in second global special situations fund

Alternative investment giant Kohlberg Kravis Roberts & Co Ltd (KKR) has marked the final close of its $3.35 billion global special situations fund.

The KKR Special Situations Fund II LP received backing from a diverse group of new and existing global investors, including public and corporate pensions, sovereign wealth funds, insurance companies, foundations, endowments, private banking platforms, family offices and individual investors.

“The number of credit assets trading at distressed levels has been increasing steadily for several months. Coupled with the wave of redemptions in the distressed and opportunistic credit fund space, pricing environment for risk is meaningfully more attractive than in prior years," Jamie Weinstein, co-head of special situations at KKR, said in a statement. "In short, we believe this is a good environment for our fund investors.”

The new fund is the successor to the KKR Special Situations Fund, which was the firm’s first dedicated special situations vehicle. The fund completed fundraising in December 2013 with $2 billion in capital commitments.

KKR invests in India out of its global or Asian funds. In February this year, KKR invested Rs 950 crore ($138 million) to acquire a 9.95 per cent stake in Max Financial Services Ltd. The PE firm made the investment through its KKR Asian Fund II.

In July last year, KKR agreed to put in $150 million (Rs 962 crore then) in Mumbai-listed polyester maker JBF Industries Ltd and its overseas arm, in its first investment in India from the second special situations fund.

The first special situations fund has fully committed and exited its investment period. Majority of the fund was deployed outside the US.

The New York-based firm formed its special situations strategy in 2009. Since then, it has raised about $9.1 billion of capital across funds, separate accounts, and firm capital.

The special situation platform of KKR is part of its $33.8 billion credit business. The special situations team includes 29 investment professionals located in Hong Kong, London, New York, Mumbai, Singapore, San Francisco and Sydney. It is supported by KKR's credit business that includes about 85 professionals.

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