Global investment firm KKR has reinforced its leadership in Asia Pacific private credit with the close of a record-breaking US$2.5 billion raise, the largest pan-regional private credit fund assembled in the region.
The raise comprises US$1.8 billion ($2.7 billion) for KKR Asia Credit Opportunities Fund II (ACOF II) and a further US$700 million from separately managed accounts (SMAs) targeting the same investment opportunities.
The milestone builds on KKR’s inaugural Asia Pacific-dedicated private credit vehicle, KKR Asia Credit Opportunities Fund, which closed at US$1.1 billion in 2022 as the region’s largest first-time pan-regional performing credit fund.
Through ACOF II, KKR’s Asia Credit platform has executed 10 investments, representing US$1.9 billion of KKR commitments across multiple capital pools, with an aggregate transaction value of US$4.6 billion.
KKR targets credit investments across Australia, Greater China, India, Japan, Korea, New Zealand and Southeast Asia.
“Asia is a key pillar of KKR’s global credit strategy,” partner and head of Asia credit and markets, Diane Raposio, said in a statement. “The close of ACOF II demonstrates the breadth and scale we have built across our Asia credit platform, spanning both private and liquid markets.”
KKR is experiencing rising investor demand for credit exposure in the region. “Our pan-Asia approach and ability to leverage the broader KKR Asia platform uniquely positions us to continue sourcing and executing interesting opportunities across the region for our investors,” Raposio said.
Private credit remains a relatively nascent but increasingly compelling opportunity across Asia Pacific, according to managing director and head of Asia private credit, SJ Lim.
“We see strong demand for private credit as an important tool for sponsors or corporates seeking flexible financing solutions and bespoke, partnership-oriented capital to support growth and meet their diverse needs. Our performing credit strategy is based on the same long term structural themes such as rising consumption, urbanisation and digitalisation that have underpinned the growth of private markets in Asia.”
The fund attracted strong backing from a diversified base of new and existing investors, including insurance companies, public and corporate pension funds, sovereign wealth funds, family offices, banks, corporates and asset managers.
Across Asia Pacific, KKR has completed more than 60 investments through its Asia Credit strategy since 2019, representing approximately US$8.3 billion of KKR capital deployed and a total transaction value of US$27.5 billion.
