Henry Kravis And George Roberts, Founders Of Private Equity Titan KKR, Step Down As Co-CEOs
As the founders of private equity giant Apollo see their longstanding friendships disintegrate into acrimony exacerbated by Leon Black’s involvement in the Epstein scandal, two of the men who founded rival private equity giant KKR have just announced that they will be quietly stepping down as co-CEOs.
KKR’s Henry Kravis and George Roberts – who are, incidentally, cousins and both billionaires – made the announcement on Monday, adding that the firm’s long-serving co-presidents, Scott Nuttall and Joe Bae, will succeed them as twin CEOs. The second ‘K’ in KKR, Jerome Kohlberg, left the firm in 1987 and died in 2015. Kravis and Roberts will remain co-executive chairman of the firm’s board and maintain relationships with investors, and will continue with a level of involvement with the company, which has been credited with helping to pioneer the LBO.
The firm also announced a series of structural and governance changes as it moves to transition to a “one share, one vote” (in stark contrast to most tech giants like Facebook) instead of the dual-class setup that allows the founders extra voting power.
After achieving success with a series of major deals, the firm attained notoriety on a literary scale with its $25 billion conquest of RJR Nabisco, where KKR won out over at least two rival firms, including one that had allied with the firm’s management. The title of the book is a reference to Kravis and Roberts, “the Barbarians at the Gate” using piles of junk bond debt in deals that, according to their critic, weren’t ultimately good for the company or employees.
Despite those early criticisms of private equity as a gang of corporate raiders, the industry has earned for itself a hallowed position within the landscape of Wall Street, generating massive profits for investors and employees alike.
According to the FT, Kravis and Roberts have remained “intimately involved in the firm despite its size. KKR has almost 2,000 employees and manages $429 billion in assets and is spread across private equity, real estate, insurance and credit investing.” Even as the two men lived on different coasts, Roberts at his base in San Francisco and Kravis in New York. Originally a partnership, KKR has evolved into a publicly-traded giant whose shares have soared during the dealmaking frenzy of the last 18 months. Most recently, KKR announced the buyout of Global Atlantic, a life insurance company.
Mon, 10/11/2021 – 07:42