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Private Investment Firm KKR Sets Up Inaugural Asia Focused $1.1 Bln Credit Fund

Private Investment Firm KKR Sets Up Inaugural Asia Focused $1.1 Bln Credit Fund
KKR has secured $1.1 billion for financing its first Asia credit fund, which provides loan financing to businesses. This is one of the largest first-time fundraisings in Asia Pacific, according to the US private equity giant.
Private credit funds have grown in popularity in Asia in recent years as businesses seek other sources of capital, however banks still provide the majority of funding. Credit funds attract investors because of the possibility for higher returns.
The Asia Credit Opportunities Fund, which achieved its final closure on Wednesday, received significant support from investors including sovereign wealth funds, insurers, and private investment groups, according to KKR.
"There is an imbalance of available financing for Asian businesses at a time when the region's growth and prosperity have fuelled an enormous demand for more flexible funding solutions by borrowers looking to seize opportunities," said Brian Dillard, head of Asia Credit at KKR.
Through its balance sheet and personnel contributions, KKR spent more than $100 million together with external investors.
The latest fund has the aim of investing primarily in "performing privately originated credit" and to take advantage of opportunities in three core investing themes - senior and unitranche corporate lending, subordinated corporate lending, and asset-based finance investments.
Large private equity funds and investment companies have also formed Asia-focused credit funds, some of which are focused on distressed assets.
Since the beginning of 2019, KKR has made 14 credit investments totaling $2.4 billion in Asia Pacific, including acquisition finance and tailored capital funding for firms and financial sponsors. A dozen or so came from the most recent fund.
Globally, KKR manages around $184 billion in credit assets.
KKR has roughly 300 senior advisers and executives in Asia Pacific, including about 10 dedicated credit specialists, since establishing its presence in the region in 2005.

Christopher J. Mitchell

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