Seeks to Invest Up To $2 Billion Initially in Middle Market and
Non-Traditional Corporate Credit Opportunities Sourced through Platform
NEW YORK & TORONTO--(BUSINESS WIRE)--
Stone Point Capital ("Stone Point") and KKR & Co. L.P. (NYSE: KKR) today
announced the addition of CPPIB Credit Investments Inc. ("CPPIB
Credit"), a wholly-owned subsidiary of Canada Pension Plan Investment
Board ("CPPIB"), as a joint venture partner and investor in MerchCap
Solutions LLC ("MCS" or the "Company"), formerly known as KKR-SPC
Merchant Advisors LLC. Formed in August of 2012, the Company provides
principal and agency-based capital markets services to sponsor-backed
and corporate mid-market companies as well as principal investments to
support its client needs.
In addition to the $300 million of capital previously committed by Stone
Point and KKR, CPPIB Credit will commit an additional $50 million of
equity to MCS to support its business. CPPIB has initially earmarked up
to $2 billion of capital for direct investment at its discretion in
middle market debt transactions and other non-traditional corporate
lending opportunities arranged for clients of MCS. Mark Jenkins, Head of
Private Debt for CPPIB, will join the board of directors of the Company
as well as its Strategic Development and Capital Allocation Committees.
The day-to-day origination, execution and underwriting activities of the
Company will continue to be carried out by KKR's capital markets
employees.
"This investment is an excellent opportunity to expand CPPIB's Private
Debt portfolio into the middle market, an attractive and underserved
market segment," said Mark Jenkins. "We also believe there are
additional underserved areas that we can target by combining our focus
with MCS's structuring and distribution expertise. This platform is well
suited to our comparative advantages and internal underwriting
capabilities, and we have initially earmarked up to $2 billion of
additional capital for direct investments in mid-market companies
through MCS. We look forward to partnering alongside KKR and Stone Point
who are longstanding, well-aligned partners of ours."
"We are excited to expand our MCS partnership with the addition of
CPPIB, an exceptional pension fund with a long investment horizon and
deep investment and market expertise that will have clear benefits for
MCS's targeted client base. With CPPIB, our company will be even better
suited to helping clients find attractive capital markets solutions,"
said Chuck Davis, Co-Founder of Stone Point.
"CPPIB has built a unique and highly differentiated private debt
capability. We look forward to combining forces with CPPIB to provide
tailored solutions to our clients, who will benefit from CPPIB's ability
to scale and hold private corporate credit assets and its long-term
orientation as a lender and investor," added Craig Farr, Global Head of
Capital Markets at KKR.
About CPPIB Credit Investments Inc.
CPPIB Credit Investments Inc. is a multi-faceted global credit
investment program wholly owned by the CPP Investment Board. Since its
inception, the group has invested approximately $10 billion of capital
and currently holds approximately $5 billion of credit investments. With
investments in the Americas, Europe and Asia, the team is focused on
providing debt financing across the entire capital structure including
term loans, high-yield bonds, mezzanine lending and other solutions for
corporations.
Canada Pension Plan Investment Board (CPPIB) is a professional
investment management organization that invests the funds not needed by
the Canada Pension Plan (CPP) to pay current benefits on behalf of 18
million Canadian contributors and beneficiaries. In order to build a
diversified portfolio of CPP assets, CPPIB invests in public equities,
private equities, real estate, infrastructure and fixed income
instruments. Headquartered in Toronto, with offices in London and Hong
Kong, CPPIB is governed and managed independently of the Canada Pension
Plan and at arm's length from governments. At September 30, 2012, the
CPP Fund totaled C$170.1 billion. For more information, please visit www.cppib.ca.
About KKR
Founded in 1976 and led by Henry Kravis and George Roberts, KKR is a
leading global investment firm with $66.3 billion in assets under
management as of September 30, 2012. With offices around the world, KKR
manages assets through a variety of investment funds and accounts
covering multiple asset classes. KKR seeks to create value by bringing
operational expertise to its portfolio companies and through active
oversight and monitoring of its investments. KKR complements its
investment expertise and strengthens interactions with investors through
its client relationships, capital markets and global stakeholder
relations platform. KKR & Co. L.P. is publicly traded on the New York
Stock Exchange (NYSE: KKR), and references to KKR in this release
include its subsidiaries, their managed investment funds and accounts,
and/or their affiliated investment vehicles, as appropriate. For
additional information, please visit KKR's website at www.kkr.com.
About Stone Point
Stone Point Capital LLC is a global private equity firm based in
Greenwich, Connecticut, that has a 25-year record of making successful
investments in the financial services industry. Stone Point Capital
serves as the manager of the Trident Funds, which have raised more than
$9 billion in committed capital to make investments in lending, banking,
insurance, asset management and other financial services companies. For
further information about Stone Point Capital, see www.stonepoint.com.
Forward-Looking Statements
This release contains certain forward-looking statements.
Forward-looking statements relate to expectations, beliefs, projections,
future plans and strategies, anticipated events or trends and similar
expressions concerning matters that are not historical facts. Without
limiting the foregoing, statements regarding the Company or the
intentions or commitments of Stone Point, CPPIB Credit and KKR may
constitute forward-looking statements. Such statements are subject to
the risk that the terms of their obligations may be modified,
commitments may not be funded at all or the benefits and synergies from
the Company are not realized. The forward-looking statements are based
on the parties' beliefs, assumptions and expectations, taking into
account all information currently available to it. These beliefs,
assumptions and expectations can change as a result of many possible
events or factors, not all of which are known to the parties or are
within their control. No party undertakes any obligation to update any
forward-looking statements to reflect circumstances or events that occur
after the date on which such statements were made except as required by
law. Additional information about factors affecting KKR is available in
KKR & Co. L.P.'s Annual Report on Form 10-K for the fiscal year ended
December 31, 2011, filed with the SEC on February 27, 2012, and other
filings with the SEC, which are available at www.sec.gov.
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CPPIB
Linda Sims, 416-868-8695
lsims@cppib.ca
or
KKR
Kristi
Huller, 212-230-9722
kristi.huller@kkr.com
or
Stone
Point Capital
Emanuel Citron, 203-862-2974
ecitron@stonepoint.com
Source: KKR & Co. L.P.
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