KKR raises $2bn for distressed vehicle

The US group is eyeing Europe after its global special situations fund came in $1bn over target.

Kohlberg Kravis Roberts has raised $2 billion for a special situations fund, closing the fund at double its original target, according to a statement.

The firm had planned to raise just $1 billion, but eventually raised twice that from both new and existing global investors. Without disclosing specific LPs, the statement said the fund attracted public and corporate pensions, sovereign wealth funds, insurance companies and family offices, among others.

The fund was launched in 2012 and held a first close in December the same year. 

“We are pleased we were able to attract such a diverse mix of new and existing KKR investors to the fund and the strategy. We are very optimistic about the global opportunity set and continue to find attractive ways to put capital to work,” KKR co-head of special situations, Jamie Weinstein, said.

The fund is targeting “distressed and event-driven investments” globally, hoping to gain strong risk-adjusted returns from market dislocations, complex situations and distressed assets, the statement said.

Since the first close, the fund has deployed about 30 percent of its capital commitments globally, with the firm particularly active in Europe. Prior to the fund, KKR’s special situations unit invested via separate accounts and has invested about $2 billion in Europe over the past two years.

The vehicle is part of KKR’s special situations platform, which was first launched in 2010 and falls under the firm’s $20.9 billion credit business.

Distressed investing has picked up worldwide as businesses continue to struggle in difficult macroeconomic climates.

“Across the globe, we have identified a number of opportunities to invest in good companies in need of a partner with long-term capital to help them grow, or to restructure a challenging situation. In each case, our goal is to be a constructive partner of choice while also delivering strong returns for our investors,” Nat Zilkha, co-head of KKR's special situations unit and the firm's head of credit, commented.

During 2013, the fund invested in Swedish bed manufacturer Hilding Anders International, TPS Group, a food-related business in Indonesia and Amedisys, a home healthcare company based in the US.