KKR has just closed $15 billion for its Asia-focused private equity fund, exceeding its original target size after receiving “strong support” from new and existing global investors, including those in the Asia Pacific region.
The new close came nearly four years after KKR raised its Asian Fund III of $9.3 billion and marks the New York-based alternative asset management titan’s ongoing interest in Asia. It also makes KKR Asian Fund IV one of the largest private equity funds dedicated to the Asia Pacific region.
KKR itself will inject about $1.3 billion into Fund IV alongside investors through the firm and its employees’ commitments. The new fund will be on the lookout for opportunities in consumption and urbanization trends, as well as corporate carve-outs, spin-offs, and consolidation.
KKR has been a prolific investor in Asia-Pacific since it entered the region 16 years ago with a multifaceted approach that spans private equity, infrastructure, real estate and credit. It currently has $30 billion in assets under management in the region.
The firm has been active during COVID-19 as well. On the one hand, the pandemic has accelerated the transition to online activities and singled out tech firms that proved resilient during the health crisis. Market disruption in the last year has also made valuations more attractive and pressured companies to seek new sources of capital. All in all, these forces provide “increasingly interesting opportunities for flexible capital providers like KKR,” the firm’s spokesperson Anita Davis told TechCrunch.
Since the pandemic, KKR has deployed about $7 billion across multiple strategies in Asia.
While KKR looks for deals across Asia, each market provides different opportunities pertaining to the state of its economy. For deals in consumption upgrades, KKR seeks out companies in emerging markets like China, Southeast Asia and India, said Davis. In developed countries like Japan, Korea and Australia, KKR observed that continued governance reform, along with a focus on return on equity (ROE), has driven carve-outs from conglomerates and spin-offs from multinational corporations, Davis added.
In particular, KKR’s private value portfolio in Asia comprises of around 60 organizations across 11 nations. A portion of its more outstanding arrangements incorporate co-driving ByteDance’s $3 billion raise in 2018 in the midst of the TikTok parent’s fast development and bankrolling Reliance Jio with $1.5 billion out of 2020.
“The chance for private value speculation across Asia-Pacific is remarkable,” said Hiro Hirano, co-head of Asia Pacific Private Equity at KKR. “While each market is interesting, the drawn out basics supporting the locale’s development are steady — the interest for utilization overhauls, a quickly developing working class, rising urbanization, and mechanical disturbance.”
The Asian Fund IV continued in the strides of KKR’s two other Asia-centered finances that shut in January, the $3.9 billion Asia Pacific Infrastructure Investors Fund and the $1.7 billion Asia Real Estate Partners Fund.