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Law360 (May 28, 2020, 7:35 PM EDT ) KKR, advised by Paul Weiss, said Thursday it has raised $4 billion for a credit fund that will invest in opportunities that exist as a result of market dislocation caused by the coronavirus pandemic, including in areas like private equity, infrastructure and real estate.
The capital raise from KKR & Co. LP consists of $2.8 billion for a vehicle called KKR Dislocation Opportunities Fund, in addition to more than $1.1 billion from separately managed accounts that have committed to the same investment strategy, according to a statement. The capital was raised over a two-month period, with contributions coming from more than 20 first-time KKR institutional investors. KKR itself and employees of the firm committed about $447 million of the $4 billion total.
"KKR's integrated global platform empowers us to access a deep pipeline of opportunities and recent market volatility has created the chance to invest in high-quality companies at attractive prices and with strong downside-protection," said Chris Sheldon, head of Leveraged Credit for KKR. "We are grateful for the trust of our investors which enabled us to immediately deploy a significant amount of capital into the March sell-off."
The fund will be led by Jennifer Box, a partner at KKR and co-head of the firm's Special Situations Group in the Americas, and Blaine MacDougald, partner and co-head of European Special Situations for KKR. They'll serve as co-portfolio managers, with a flexible mandate to invest in a variety of areas across the public and private credit markets over an initial 18-month investment period.
The focus will be finding "attractively priced credit risk in the secondary markets and providing liquidity and capital solutions to high-quality borrowers as they manage through the crisis resulting from COVID-19," according to the press release.
KKR has remained active in an unsteady market environment. The firm has announced a number of significant transactions in recent weeks, and is rumored to be considering a €200 million ($222 million) loan for Swiss vending machine operator Selecta.
Just this week, the firm both contributed to a roughly 130 billion Japanese yen ($1.2 billion) financing for Italian automotive parts supplier Marelli, which has faced coronavirus-induced struggles, and put forth $1 billion in initial capital for a new data center platform in Europe it is launching with entrepreneur Franek Sodzawiczny.
This month also saw KKR kick in for a total $190 million funding round for data analytics company Contentsquare, and lead a $43 million investment in Slice, which offers a platform to order pizza from local pizzerias and boasts about 5 million users.
The Paul Weiss Rifkind Wharton & Garrison LLP team advising KKR on the new fund includes partner Marco V. Masotti and associates Victoria Forrester and Brendon Smith.
-- Additional reporting by McCord Pagan and Elise Hansen. Editing by Amy Rowe.
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