Quick turnaround

Few comings or goings proved as surprising in the last month as George Bilicic's abrupt resignation as head of infrastructure at New York-based alternative assets giant Kohlberg Kravis Roberts (KKR).

After less than six months on the job, the lawyer-turned-banker-turned-private equity investor returned to investment banking. He accepted a sweetened version of his old role at Lazard, from which he joined KKR in early June.

Bilicic's sudden departure came as all the more of a shock to those in attendance at PEI's Infrastructure Investor Forum in New York, where the DeSales University graduate was interviewed less than a week before leaving KKR in early November.

“As a lawyer or a banker, I never earned a dollar of revenue representing a private equity firm. I worked with corporates,” he told an audience curious to see who KKR boss Henry Kravis had tapped for his first foray into infrastructure. “So I was sitting at Lazard thinking that if I were to leave Lazard I would go into public service at some point and do something for the country and for others,” he added.

Bilicic said that an intermediary, who he did not identify, raised the idea of moving to KKR. The buyout giant was one of the few private equity firms with which he had much contact while at Lazard. Most recently, he found himself across the table from the buyout shop while advising Texas utility TXU on its $45 billion KKR- and TPG-led buyout.

“I always knew I could trust KKR if I brought one of my investment opportunities on behalf of a client,” Bilicic said.

KKR, in turn, trusted him to head its nascent infrastructure effort, which it launched inMay when senior advisors John Bookout and Clint Johnstone joined the infrastructure team ahead of Bilicic's arrival.

KKR had been planning a $10 billion infrastructure fund, according to various media reports. However, some market sources pegged the target as half that amount.

So what prompted Bilicic's change of heart?

At KKR, the official explanation is rooted in nostalgia for his old job.

George Bilicic concluded that he finds advising clients most rewarding,” a source familiar with KKR told sister website InfrastructureInvestor when the news broke.

Others said the abrupt departure may have been precipitated by differences over how KKR should build out its global infrastructure team, which Bilicic had been charged with recruiting.

Bilicic did not return calls seeking comment, but when asked at the Forum how his role was progressing at the buyout giant, he made repeated reference to consensusbuilding.

“There is in KKR or in any organisation a consensusbuilding effort around what the investment thesis is in a particular area,” he said.

No matter what the reason for the about-turn, one thing is for certain: Lazard welcomed back its star banker with open arms. He left as head of Lazard's global power, energy and infrastructure group and returned as chairman of its power, utilities and infrastructure group – a position which a source at Lazard said comes with more responsibility.

It might also be relevant that KKR, according to market sources, has yet to release a private placement memorandum for its infrastructure fundraising.