8-KMaterial AgreementsFinancial EventsRegulation FD+1

KKR & Co. Inc. 8-K Report, Material Agreement (Dec 8, 2021)

Filed December 8, 2021For Securities:KKRKKRTKKR-PDKKRS

Summary

KKR & Co. Inc. (KKR) filed an 8-K on December 8, 2021, reporting the completion of a material definitive agreement related to the issuance of debt. Specifically, KKR Group Finance Co. X LLC, an indirect subsidiary, successfully offered $750 million in aggregate principal amount of 3.250% Senior Notes due 2051. These notes are guaranteed by KKR & Co. Inc. and KKR Group Partnership L.P., providing a solid backing for investors. The net proceeds from this offering are earmarked for general corporate purposes, indicating a strategic move to bolster the company's financial flexibility. The issuance of these long-dated notes at a fixed interest rate of 3.250% suggests KKR's strategy to secure favorable long-term financing. The indenture governing these notes includes standard covenants aimed at protecting noteholders, such as limitations on liens and asset disposals, and provisions for events of default. Importantly, the notes are unsecured and unsubordinated obligations, though they are fully guaranteed by the parent entities. The report also details redemption options, including a make-whole provision prior to maturity and a par redemption in the final months, as well as a change of control repurchase event provision. This debt issuance provides KKR with substantial capital that can be deployed across its various investment strategies and operational needs. Investors in these notes gain exposure to KKR's creditworthiness with a fixed income stream maturing in 2051, backed by the company's substantial assets and reputation in the alternative asset management industry. The transaction was conducted under Rule 144A and Regulation S, indicating a placement to institutional investors.

Key Highlights

  • 1KKR completed the offering of $750 million in 3.250% Senior Notes due 2051.
  • 2The notes are guaranteed by KKR & Co. Inc. and KKR Group Partnership L.P.
  • 3Proceeds from the offering are intended for general corporate purposes.
  • 4The notes mature on December 15, 2051, unless redeemed earlier.
  • 5Interest is payable semi-annually at a fixed rate of 3.250% per annum.
  • 6The indenture includes covenants limiting liens, mergers, and asset sales.
  • 7A change of control repurchase event would trigger a 101% repurchase price for noteholders.

Frequently Asked Questions

This 8-K filing announces the completion of KKR & Co. Inc.'s subsidiary's offering of $750 million in Senior Notes due 2051. It provides details about the terms of the notes, the guarantees, and the intended use of proceeds.

The net proceeds from the sale of the Notes are intended for general corporate purposes. This typically includes funding operations, strategic initiatives, potential acquisitions, or investments across KKR's various funds.

The Senior Notes are unsecured and unsubordinated obligations of the issuer, KKR Group Finance Co. X LLC. However, they are fully and unconditionally guaranteed, jointly and severally, by KKR & Co. Inc. (the parent company) and KKR Group Partnership L.P., providing significant credit support.

The indenture includes standard covenants that limit the ability of the issuer and guarantors to incur certain secured debt, merge, consolidate, or sell substantially all assets. It also outlines events of default and provides for acceleration of the notes in such events or upon bankruptcy/insolvency. Additionally, there's a provision for a change of control repurchase event at 101% of the principal amount.