Summary
KKR & Co. Inc. (KKR) filed an 8-K on March 23, 2020, primarily to report the entry into a new material definitive agreement: a third amended and restated 5-year revolving credit agreement. This new agreement, dated March 20, 2020, replaces a prior agreement and provides KKR Capital Markets Holdings L.P. and its capital market subsidiaries with up to $500 million in revolving credit facilities, with a $500 million sublimit for letters of credit. The facility expires on March 25, 2025, and ranks equally with an existing $750 million 364-day revolving credit facility. The new credit agreement is specifically for KKR's capital markets business, and importantly, its liabilities are non-recourse to other parts of KKR's broader business. This structure is a key point for investors seeking to understand potential contagion risks. As of the agreement date, there were €75 million in borrowings and $55.1 million in outstanding letters of credit under this facility, which reduce the available borrowing capacity.
Key Highlights
- 1KKR entered into a new 5-year revolving credit agreement worth up to $500 million, with a $500 million sublimit for letters of credit.
- 2The new credit facility is set to expire on March 20, 2025.
- 3This agreement replaces a previous 5-year revolving credit agreement that was terminated on March 20, 2020.
- 4The new facility ranks pari passu (equally) with KKR's existing $750 million 364-day revolving credit facility for its capital markets business.
- 5Borrowings under the new agreement are exclusively for KKR's capital markets business.
- 6Liabilities under this new credit agreement are non-recourse to KKR's other business segments, limiting potential impact on the broader company.
- 7As of March 20, 2020, there were €75 million in outstanding borrowings and $55.1 million in outstanding letters of credit under this facility.