KKR prices ¥91,400,000,000 of senior notes

Rhea-AI Summary

KKR has announced the pricing of ¥91.4 billion in senior notes, split across five tranches with varying maturity dates and interest rates. The largest tranche, ¥44.6 billion, is due in 2029 with a 1.559% interest rate. Smaller tranches include ¥1 billion due in 2031 at 1.762%, ¥26.2 billion due in 2034 at 2.083%, ¥10 billion due in 2044 at 2.719%, and ¥9.6 billion due in 2054 at 3.008%. KKR intends to use the proceeds for general corporate purposes. The offering is targeted at qualified institutional buyers in the U.S. and international buyers, complying with Rule 144A and Regulation S under the Securities Act of 1933. The notes are unregistered and cannot be sold in the U.S. without proper registration or exemption. This announcement follows Rule 135c guidelines.

Positive

• Raised ¥91.4 billion through senior notes.
• Largest tranche: ¥44.6 billion due in 2029 at 1.559%.
• Diversified maturity dates; reduces refinancing risk.
• Proceeds to be used for general corporate purposes.
• Targeted at qualified institutional buyers and international buyers, expanding potential investor base.

Negative

• Notes are unregistered, limiting liquidity in the U.S.
• Potential currency risk due to issuance in yen.
• Interest rates on some notes relatively high: 2.719% (2044) and 3.008% (2054).
• Long-term debt increase, potentially affecting leverage ratios.
• Market conditions and exchange rates could affect the value and repayment of these notes.

Financial Analyst

KKR's issuance of senior notes totaling ¥91.4 billion across several maturities is significant. The diversity in note maturities, ranging from 2029 to 2054, provides the company flexibility in managing its debt profile over an extended period. The interest rates on these notes, varying from 1.559% to 3.008%, are relatively low, reflecting the current low-interest-rate environment and investor confidence in KKR's creditworthiness.

From an investor's perspective, the proceeds will be used for 'general corporate purposes,' which is broad but common. It signals the company's intention to maintain liquidity and possibly fund new investments or acquisitions. The issuance to qualified institutional buyers suggests they are tapping into a mature and sophisticated investor base, indicating strong confidence in the stability and growth potential of the notes.

Given that these notes are fully guaranteed by KKR & Co. Inc. and KKR Group Partnership L.P., this adds an extra layer of security for investors, potentially making these notes attractive for risk-averse institutional investors.

However, retail investors should note that these notes are not registered under the Securities Act and are not intended for the public market, limiting direct participation. Indirectly, though, such moves can signal overall financial health and strategic liquidity management, which can positively impact the company's stock performance.

NEW YORK--(BUSINESS WIRE)-- KKR & Co. Inc. (“KKR”) (NYSE: KKR) today announced that it has priced an offering of ¥44,600,000,000 aggregate principal amount of its 1.559% Senior Notes due 2029 (the “2029 notes”), ¥1,000,000,000 aggregate principal amount of its 1.762% Senior Notes due 2031 (the “2031 notes”), ¥26,200,000,000 aggregate principal amount of its 2.083% Senior Notes due 2034 (the “2034 notes”), ¥10,000,000,000 aggregate principal amount of its 2.719% Senior Notes due 2044 (the “2044 notes”) and ¥9,600,000,000 aggregate principal amount of its 3.008% Senior Notes due 2054 (the “2054 notes” and, together with the 2029 notes, the 2031 notes, the 2034 notes and the 2044 notes, the “notes”) issued by KKR Group Finance Co. XI LLC, its indirect subsidiary. The notes are to be fully and unconditionally guaranteed by KKR & Co. Inc. and KKR Group Partnership L.P.

KKR intends to use the net proceeds from the sale of the notes for general corporate purposes.

The notes will be offered and sold to qualified institutional buyers in the United States pursuant to Rule 144A and outside the United States pursuant to Regulation S under the Securities Act of 1933, as amended (the “Securities Act”).

The notes have not been registered under the Securities Act or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act and applicable state laws.

This press release shall not constitute an offer to sell or a solicitation of an offer to purchase the notes or any other securities, and shall not constitute an offer, solicitation or sale in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful. This press release is being issued pursuant to and in accordance with Rule 135c under the Securities Act.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This press release contains certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section 27A of the Securities Act of 1933, as amended, pertaining to KKR. Forward-looking statements relate to expectations, estimates, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. These forward-looking statements can be identified by the use of words such as “outlook,” “believe,” “think,” “expect,” “potential,” “continue,” “may,” “should,” “seek,” “approximately,” “predict,” “intend,” “will,” “plan,” “estimate,” “anticipate,” the negative version of these words, other comparable words or other statements that do not relate strictly to historical or factual matters. These forward-looking statements are based on KKR’s beliefs, assumptions and expectations, but these beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to KKR or within its control. Due to various risks and uncertainties, actual events or results may differ materially from those reflected or contemplated in such forward-looking statements. We believe these factors include those in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 and our Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2024, as such factors may be updated from time to time in our periodic filings with the SEC, which are accessible on the SEC’s website at www.sec.gov. These factors should be read in conjunction with the other cautionary statements that are included in our periodic filings. Past performance is no guarantee of future results. All forward-looking statements speak only as of the date of this press release. KKR does not undertake any obligation to update any forward-looking statements to reflect circumstances or events that occur after the date of this press release except as required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240522211475/en/

Investor Relations:

Craig Larson

Tel: +1 (877) 610-4910 (U.S.) / +1 (212) 230-9410

investor-relations@kkr.com

Media Contact:

Wei Jun Ong

Tel: + 1 (212) 750-8300

media@kkr.com

Source: KKR & Co. Inc.

FAQ

What is the total value of KKR's senior notes offering?

The total value of KKR's senior notes offering is ¥91.4 billion.

What is the interest rate for KKR's 2029 senior notes?

The interest rate for KKR's 2029 senior notes is 1.559%.

When will KKR's 2034 senior notes mature?

KKR's 2034 senior notes will mature in 2034.

For what purposes will KKR use the proceeds from the senior notes offering?

KKR intends to use the proceeds from the senior notes offering for general corporate purposes.

Are KKR's senior notes registered under the Securities Act?

No, KKR's senior notes are not registered under the Securities Act.