KKR latest to settle in collusion case

Only three buyout firms remain now in a lawsuit accusing some of the largest names in private equity of bid rigging

Kohlberg Kravis Roberts (KKR) agreed to settle a long-running lawsuit accusing marquee private equity firms of colluding by agreeing not to outbid each other on certain boom-era buyout deals, according to a regulatory filing.

KKR agreed to settle all claims without disclosing the settlement price or admit any wrongdoing.

“Defending against shareholder litigation has long been a part of pursuing public company acquisitions in the US, and settling acquisition-related litigation is frequently in the best interest of our investors, on whose behalf we pursue those acquisitions,” a KKR spokesperson said in an email to PEI.

“While we continue to believe that the plaintiffs’ allegations are spurious, we determined that after seven years it was best for KKR and our limited partners to put an end to the distraction and expense of this litigation.”

Last month Silver Lake Partners agreed to settle for $29.5 million joining Bain Capital, who agreed to a $54 million settlement, and Goldman Sachs who agreed to a $67 million settlement back in June.

“While we continue to believe that the plaintiffs' claims about Silver Lake are baseless and without merit, we concluded that it was in the best interest of our limited partners to put this matter behind us, and end over six years of litigation, expense and distraction,” a Silver Lake spokesperson said.

Bain spokesperson, Ernesto Anguilla, told PEI, the court never cited any evidence tying Bain to any of the alleged claims. “We continue to believe the case is meritless and baseless, but ultimately determined that it was best for our investors and our firm to put this matter behind us in light of the costs and distraction of six years of litigation.”

Two of the remaining three defendants, The Blackstone Group and TPG Capital, are also in talks to settle the lawsuit, according to media reports.

The suit was filed in December 2007 by individual shareholders in companies that were acquired by the private equity firms, like Freescale Semiconductor. LPs such as the Detroit Police and Fire Retirement System and New Profit Sharing Trust joined the shareholders.

This article also appeared in Private Funds Management.