KKR wanted to follow Blackstone (BX) into the public markets, but the recession and credit crisis ruined that dream. Blackstone’s shares were so badly beaten down that the KKR partners may be glad that they missed their window.
But, now KKR will have publicly traded shares which may give its major owners some liquidity. The private equity firm sneaked its shares out the back door by beginning to trade on the Amsterdam exchange. It got there by a merger with its European arm, K.P.E.
The move denies US investors from having easy access to trading the shares which could hurt KKR’s prospects of making a meaningful market in the stock. A move from the Euronext Amsterdam exchange to the NYSE may be possible, but it is not clear what KKR would have to do to meet the American exchange’s listing regulations.
In many ways it is embarrassing the one of the world’s largest and most time-honored private equity and venture firms has to go public on an exchange of very modest size. It diminishes the firm’s image. Whether that matters to its partners is a matter of speculation.
The one intelligent thing that KKR did, even if it began as an accident of history, was to wait for the credit crisis to mostly pass. After going public, Blackstone’s shares dropped from $28 to under $4 in just over a year.
Douglas A. McIntyre