A listed investment trust that provides access to KKR’s global credit income capabilities has commenced trading on the ASX.
The listing follows the completion of the LIT’s initial public offering, which received strong support from Australian and New Zealand investors, raising $925 million including oversubscriptions via the issue of 370,000,000 fully paid ordinary units at a subscription price of $2.50 per unit.
“Australian and New Zealand investors recognise the importance of gaining exposure to global credit markets as part of a diversified and balanced portfolio,” KKR member Jeremiah Lane said. “ As a result, the demand for the KKR Credit Income Fund has been overwhelmingly positive, prompting us to increase the offer while still scaling back the total order book.
“As units in the trust start trading today on the ASX, I am confident in our global credit team’s expertise and ability to deploy the funds raised through our disciplined and holistic approach. Building on the team’s proven track record we aim to provide an attractive income stream, as well as delivering long-term capital preservation and attractive returns for unitholders over a full market cycle.”
The $925 million raised will be used to invest in a diversified portfolio of income-generating alternative credit assets through the trust’s investment into KKR’s existing credit funds. KKR said unitholders will gain exposure to global credit investments that are normally available to institutional investors.
“The assets primarily will include loans, bonds, notes (fixed and floating rate) and other debt securities and related financial instruments, including senior secured loans, traded senior secured bank loans and high-yield bonds,” the manager said.
Evans Dixon, Morgan Stanley, Morgans Financial and NAB acted as lead arrangers and joint lead managers to the IPO. Crestone Wealth Management, Ord Minnett and Wilsons Corporate Finance acted as joint lead managers, with Bell Potter Securities, Patersons Securities and Shaw and Partners acting as co-managers to the IPO. Perpetual is the responsible entity of the trust.
KKR is a global investment firm with total credit assets under management of US$70.3 billion as of 30 September 2019.