KKR’s Joseph Bae, Scott Nuttall succeed founders as co-CEOs
Henry Kravis, George Roberts
KKRMonday’s announcement by the firm said that it had elevated Scott Nuttall, its co-presidents, and Joseph Bae as co-chief executives officers. They succeed Henry Kravis and George Roberts who were billionaires and co-founders of private equity firm Private Equity.
It has been in development for many years, and it is not likely to shock investors. KKR appointed Bae (49) and Nuttall (48) as co-presidents for 2017. Monday’s announcement by KKR stated that Roberts (78) and Kravis (77), would continue to be involved as co-chairmen in running the company.
KKR stated that KKR’s shares increased by three times and its assets under management and distributable income have more than doubled since Bae and Nuttall were officially made Kravis’ and Roberts’ top lieutenants in 2004.
Nuttall & Bae have to recreate the success of Kravis & Roberts 45 years ago. They had their names in KKR’s acronym. However, the family maintained a strong grip on the company and helped to shape leveraged buyout.
Stephen Schwarzman, Blackstone Group’s CEO and 74-year-old mother, has been removed from his role as chief executive of the major privately listed equity company. Jonathan Gray has been the chief operating officer and president of Blackstone Group for over a decade.
Kewsong Lee, Carlyle Group Inc’s CEO, succeeded Tony Ressler, William Conway, and Daniel D’Aniello as Ares Management Corp CEO Michael Arougheti. Marc Rowan was Apollo Global Management Inc’s cofounder and succeeded Leon Black. This happened after a review of Leon’s ties with Jeffrey Epstein, a financier who has been convicted of sex offences.
Both Nuttall, and Bae joined KKR as KKR employees in 1996. Nuttall’s previous experience at Blackstone was less than two years. Bae spent a similar short time at Goldman Sachs Group Inc, the principal investment group.
Nuttall was instrumental in taking KKR public. This involved the merger of the firm and an Amsterdam-listed fund, followed by the move to New York. Nuttall was a regular on the quarterly earnings calls with Wall Street analysts. He also managed KKR’s capital markets and credit.
Bae is the key driver behind KKR’s Asia expansion. The firm has become one of America’s largest private equity investors. As a member of KKR’s investment committees, the Korean-American dealmaker was also a part of its global private equity company.
KKR has grown from a small $30 million fund in 1978 and now manages more than $429Billion. This was due to the investment of money from many institutional investors, such as sovereign wealth funds and pension plans. This portfolio includes private equity, real property, corporate credit, and hedge funds.
KKR was first recognized for its $22.5 billion leveraged acquisition of RJR Nabisco, which took place in 1988. The battle is immortalized in “Barbarians At the Gate”. These investments are made in ride-sharing startups. LyftWella AG, beauty product manufacturer and media group Axel Springer
Forbes estimates that Roberts and Kravis have a net worth of $9.1 billion and $8.6 billion respectively.
KKR also announced on Monday its leadership changes and said it would be taking steps to abolish its dual-class shares structure. This was Apollo’s second year, after Carlyle became the first publicly listed private equity firm.
KKR announced that all the major matters, such as election of board members and other important topics will now be open to common shareholders. This will be possible through a complicated web of mergers between KKR entities, which is expected to be complete by 2026.