About Nature's Bounty, Inc.
KKR — the master of the leveraged buyout — has ditched its hostile takeover image for a kinder, gentler, buy-and-build strategy. The global investment firm has about $220 billion in assets under management, with large investments in such companies as Trainline PLC, GEG German Estate Group AG (financial services sector), and Sedgwick Claims Management Services, Inc. Preferring to hold onto its investments for the long term, KKR invests in multiple asset classes including private equity, infrastructure, energy, real estate, credit, and hedge funds. Launched in 1976, the firm is led by co-founders Henry Kravis and George Roberts. About 60% of the company's revenue is generated from the US.
KKR operates through one reportable segment but categorized into four business lines: Private Markets, Principal Activities, Capital Markets, and Public Markets.
KKR manages a collection of private equity funds through its Private Markets business line. It houses more than $119.3 billion in assets under management consisting of $78.9 billion in private equity (including growth equity and core investments), $27.7 billion in real assets (including infrastructure, energy and real estate) and $12.7 billion in other related strategies. It also invests in physical infrastructure, real estate, and energy assets. It makes revenue through management, monitoring, and transactions fees associated with its funds and garners gains or losses when it sells portfolio companies. The segment supervises or installs new management in its portfolio companies and revamps strategy and corporate structure, selling underperforming units or adding new ones.
The Principal Activities business line is focused on making money for KKR by investing excess capital in its own Private, Public, and Capital Market opportunities and other holdings.
Capital Markets business line supports KKR corporate, KKR's private equity portfolio companies, and third-party investors by developing and implementing both traditional and non-traditional capital services such as arranging debt and equity financing, placement and underwriting for transactions including debt and equity financings and securities offerings.
The Public Markets business line earns management fees on holdings and for the advisement of financial instruments such as leveraged loans, high yield bonds, opportunistic credit and revolving credit strategies, special situations and private credit strategies, and hedge funds.
New York-based global investment firm KKR has offices in the North America, Europe, Asia, and Australia. Of the company's approximately 1,040 investors, about 60% are based in the Americas, more than 20% in the Asia-Pacific region, roughly 10% in Europe, and greater than 5% in the Middle East.
Sales and Marketing
KKR's investment management service clients include investment funds, collateralized loan obligation managers, oil and gas wholesalers, investment funds, other vehicles, third party companies, portfolio companies and other companies. Its fund investor base is approximately 45% public pensions and agencies, 25% financial institutions, about 15% insurance companies, nearly 10% corporate investors, and more than 5% family offices and high-net-worth investors. Endowments, foundations, and funds of funds make up one percent.
KKR's fee revenue trended higher in recent years thanks to new portfolio acquisitions and other public and capital market fund management activities. The company's net income has seen a meteoric rise in that time, rising more than 310% since 2015.
KKR's revenue rose 76% to $4.2 billion in 2019 from $2.4 billion in 2018. KKR's Total Fees and Other decreased in 2019 primarily as a result of an increase in fee credits and a decrease in transaction fees and incentive fees. Partially offsetting these decreases was an increase in management fees. Despite the decrease in fees, KKR's capital allocation-based income rose considerably due to a higher level of net appreciation in the value of its private equity investment portfolio as compared to 2018.
Net income added 77% in 2019 to end the year at $2 billion. The increase was primarily due to an increase in net gains from investment activities and capital allocation-based income, and to a lesser extent, an increase in dividend income.
KKR ended 2019 with $3.2 billion in cash on hand, a $595.9 million increase from 2018. Investment purchases drove operations spend of $5.7 billion; the company used $207.4 million on its investments (primarily fixed asset purchases and development of oil and natural gas properties). Financing activities provided $6.5 billion (mostly from debt proceeds and contributions from noncontrolling interests).
KKR's strategy is typical for private equity firms. It raises capital, deploys it into long-term investments, garners management and performance fees for administering the investment funds, and eventually realizes capital gains through a profitable exit.
In mid-2020, KKR has grown its real estate industrial portfolio with new acquisitions. It acquired two industrial distribution properties for approximately $260 million. The two properties are the first industrial properties acquired by KKR's core plus real estate strategy. Since launching a dedicated real estate platform in 2011, KKR Real Estate has grown to approximately $11.8 billion in assets under management across the U.S., Europe, and Asia as of March 2020.
KKR also invested in Australian environmental markets platform GreenCollar and in the leading vocational training company in Spain, MasterD in 2020, as investment is part of KKR's Global Impact strategy, helping deliver commercial solutions to social and sustainability challenges. KKR's investment in MasterD is the second in Europe by the KKR Global Impact fund, with MasterD helping to narrow the skills gap in Spain, promoting equal and affordable access to education, and significantly increasing profitability of employment. Its acquisition of GreenCollar advances KKR's mission to provide commercial solutions to climate change related challenges faced by governments, corporates, and individuals.
Additionally, KKR is set to acquire Global Atlantic Financial Group, a leading retirement and life insurance company with over $70 billion of adjusted invested assets. This strategic transaction is expected to be accretive across key financial metrics and meaningfully increase KKR's permanent capital base.
Mergers and Acquisitions
KKR typically invests in 15-20 companies annually.
In 2020, KKR announced that it will acquire Global Atlantic Financial Group Limited, one of the largest fixed rate and fixed indexed annuity providers in the US, offering annuities for individuals through a network of banks, broker-dealers, and insurance agencies as well as life insurance for individuals and corporates.
Also in 2020, the company agreed to purchase a controlling stake in J.B. Chemicals & Pharmaceuticals Ltd., one of the leading pharmaceutical companies in India, supplying affordable, high-quality products in the cardiac, gastrointestinal and anti-infective therapeutic areas across the branded formulations market.
In a separate transaction, KKR acquires stake in First Gen through voluntary tender offer by Valorous Asia Holdings (the "Offeror"), an entity owned by KKR investment funds. The Offeror has accepted all of the 427,041,291 common shares of First Gen Corporation. The company also announced that it will acquire Roompot Group, a provider of holiday parks in Western Europe and #1 operator in the Netherlands, from leading European private equity firm PAI Partners.
In early 2020, the company acquired a majority stake in Etche from Groupe BMF and co-founders. Etche is a private real estate company, founded in 2010 by the late Jean-Pierre Raynal and Léon Baruc that owns and operates a portfolio of over 120 assets -- €400m GAV across France in the logistics, light industrial and office sectors. The company also announced in early 2020 that it will acquire five solar energy assets from SP Infra for total consideration of INR15.54 billion (approximately US$204 million). The portfolio comprises of assets with a capacity of 169MWp in Maharashtra and assets with a capacity of 148 MWp in Tamil Nadu.
In 2019, the company acquired Australian business management software company MYOB Group for about $2 billion. That year, the company also acquired a majority stake in Indian education services company EuroKids International from an investor consortium that includes Gaja Capital.
KKR, which went public via an IPO valued at nearly $2 billion in 2010, took a circuitous route to the public market. The transaction involved a share swap, in which shareholders of its publicly traded European arm KKR Guernsey traded their shares for stakes in KKR. KKR Guernsey ceased trading and its shareholders assumed ownership of some 30% of KKR; staff and executives own the rest. The company used proceeds from the offering to strengthen its capital base and to make a number of acquisitions. It also hopes to use its publicly traded stock to attract and retain employees.
Since its founding, KKR & Co. has completed more than 350 private equity investments with a total transaction value in excess of $600 billion. KKR has participated in some of the industry's largest deals. Along with TPG, the company in 2007 bought Dallas-based utility TXU (now Energy Future Holdings) in one of the largest private equity buyouts ever. The $45-billion price tag, which included the assumption of TXU's debt, dwarfed the approximately $30 billion that KKR paid in its legendary 1988 takeover of RJR Nabisco, which remained the largest-ever deal for more than a decade. Other large deals included the acquisitions of hospital operator HCA, Toys "R" Us, and First Data.
2100 Smithtown Ave
Ronkonkoma, NY 11779-7347
Phone: 1 (631) 200-2000
Employer Type: Privately Owned
ATTORNEY: Li Liu
Employees (This Location): 800
Employees (All Locations): 1,184