Kohlberg Kravis Roberts & Co. (KKR), the global private-equity firm, has finally received bids for its capital research firm – Ipreo, according to a Financial Times report. The bidders including The Blackstone Group L.P. (NYSE:BX), The Carlyle Group LP (CG), a few other private equity firms and some buyout firms have valued the business at around $800 million.
This latest move comes after Kohlberg Kravis started seeking opportunities for shedding Ipreo. Though the company was looking to get a price in the range of $850 million to $1 billion, the amount is significantly higher than the acquisition price of $425 million, which Kohlberg Kravis paid to acquire this firm back in 2011.
Notably, Bank of America Corp. (NYSE:BAC) and Morgan Stanley ( NYSE:MS) will run the transaction process. However, any formal announcement has not been made by Kohlberg Kravis and other companies associated with the deal.
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Ipreo was founded in 2006 and is engaged in providing capital market data, software services and other investment communication tools to investment banks and financial institutions globally.
Deals like acquiring market intelligence firms are lucrative to companies owing to their steady revenue generation ability from subscription fees. From Kohlberg Kravis’ perspective, it seems a strategic exit from the research firm after running it for period of three years, as the company is set to reap significant amount of profits through this divestiture.
Kohlberg Kravis has shown impressive growth backed by its meaningful mergers, acquisitions and divestments. Further, as the economy is witnessing a gradual recovery post the financial crisis, we believe a rise in such transactions that will continue to benefit the company in the long run.
Kohlberg Kravis currently holds a Zacks Rank #3 (Hold).