LONDON (dpa-AFX) - KKR & Co. Inc. (KKR) announced an agreement to acquire Gen II Fund Services, LLC or Gen II, a private capital fund administration firm, for a total enterprise value of $5.1 billion. The investment firm is acquiring Gen II from shareholders Hg, General Atlantic, and other minority investors through its Core Private Equity strategy.
The transaction is subject to customary closing conditions and regulatory approvals, with an expected close in 2027.
Gen II, founded in 2009 by Steven Millner, Steven Alecia, and Norman Leben, serves the private markets industry, providing fund administration services to more than 275 investment managers representing over $2 trillion in assets. The company also offers tax, compliance, treasury, and technology-enabled solutions.
General Atlantic and Hg co-led an investment in Gen II in 2020. Since that investment, the company expanded its U.S. and European footprint, broadened its offerings, and quadrupled revenue and EBITDA through organic growth and four strategic acquisitions.
Following the acquisition, CEO Steven Millner will continue to lead Gen II and will work along with KKR to support continued expansion in the U.S. and internationally. They also plan to broaden capabilities across asset classes and services and invest further in proprietary technology and AI-enabled solutions.
KKR said it also plans to help implement a broad-based employee ownership program, allowing all Gen II employees to participate in the company's future growth.
Chris Harrington, Partner at KKR, stated: 'Gen II is exactly the type of financial services business we look for - a sophisticated sector leader with exceptional client relationships and a differentiated service model. The company has become the gold standard in fund administration through its white-glove service model and founder-led culture and is well positioned to benefit from the structural growth of private markets. We see significant opportunity to support the team as they expand globally and deepen their capabilities.'
In the deal, Simpson Thacher & Bartlett LLP served as legal advisor to KKR. Morgan Stanley & Co. LLC, Robert W. Baird, and UBS Investment Bank acted as financial advisors to the sellers.
In the overnight trading on the NYSE, KKR shares were gaining around 0.47%, at $90.38, after closing Monday's regular trading 0.37 percent lower.
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