Two of the private equity industry’s publicly traded titans are having no trouble turning a profit.
A week after Blackstone released mostly promising 2Q results, KKR announced it has posted $830.3 million in economic net income for the same period, up from $248.8 million in 2Q 2016. The massive increase was buoyed by increases in transaction fees and carried interest gains, per the firm’s earnings report. As of the end of June, KKR had $148.5 billion in AUM, up almost $11 billion from the previous quarter. While that’s an enormous sum, it still ranks behind KKR’s three biggest competitors in terms of total AUM, per PitchBook data.
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KKR has also agreed to take a 47% stake in South Korea-based LS Automotive, a provider of electrical components for the automotive industry, and buy another LS affiliate that makes automotive copper foils. The joint venture with LS (KRX: 00620) gives the combined businesses an enterprise value of some $924 million. KKR tapped its $9.3 billion Asian Fund III for the investment.
The news comes just months after KKR purchased Nissan Motor-backed auto parts maker Calsonic Kansei for up to $4.5 billion in what marked the firm’s biggest deal in Japan to date. To make matters even sweeter, the firm reportedly beat out rivals MBK Partners and Bain Capital for the business.
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Article by Adam Lewis, PitchBook