KKR Profit Rises 26% As Assets Soar

Private equity giant Kohlberg Kravis Roberts, preparing for an initial public offering, said yesterday that its net income rose 26% in the first half as leveraged buyout activity soared.

KKR said in a filing with a Securities and Exchange Commission that profits rose to $667.4 million from $529 million in the year-earlier period, as assets under management soared 89% to $45.1 billion. Strong investment performance—investment income rose 69% to $3.4 billion during the period—offset a decline in fee income due to lower transaction fees. KKR earned $115.4 million in fees, a 26% drop from last year.

“Financing leveraged buyout transactions by issuing high-yield debt securities in the public capital markets has recently become more costly and restrictive,” according to the filing.