Kohlberg Kravis Roberts has raised $305 million in an initial public offering for its KKR Income Opportunities Fund, a vehicle that will invest “across credit instruments”, according to a statement.
If KKR exercises an option to purchase additional shares, the fund size will increase to $352 million.
KKR Asset Management, which manages non-investment grade debt and public equities and invests across the capital structure, will act as the fund’s investment advisor. The fund will be managed by KKR’s co-heads of leveraged credit Chris Sheldon and Erik Falk, as well as KKR’s co-heads of special situations Nat Zilkha and Jamie Weinstein. The team will invest the fund using a similar process to its high-yield, bank loans and special situations strategies, according to a statement.
“Increasingly, individual investors are seeking exposure to strategies to diversify beyond traditional long-only equity and bond funds,” George Roberts, co-founder and co-chief executive officer of KKR said in the statement. “We believe that alternative investments represent an important aspect of all investors' asset allocation as they can deliver attractive risk-adjusted returns.”
KKR Income Opportunities Fund is the firm’s first publicly listed closed-end fund.
Last month, Craig Farr, who oversees KKR’s capital markets group, replaced William Sonneborn as head of KKR Asset Management. Sonneborn retired after nearly five years leading the group, but will remain close to the firm as a senior advisor starting in October.
In 2012, KKR opened up two non-private equity funds to retail clients of US brokerage Charles Schwab. Investors could choose from a high-yield fund with a minimum contribution of $2,500, or a distressed vehicle with a minimum commitment of $25,000.
KKR was unavailable for comment at press time.