Henry Kravis

Was Kravis forced to sell art?

Jim Kim — Wed, 05 Nov 2008 13:18:36 -0500

How tough is this economy? Well, private equity kingpin Henry Kravis sold an Edgar Degas this week via a Sotheby's auction. The piece fetched just over $37 million, a new record for the French master, notes Breakingviews, which nevertheless recommends that Kravis stick to private equity transaction. The final price works out to annualized return of just 3 percent since 1999, when he snapped up the work for $28 million. Kohlberg Kravis Roberts' 1992 and 2002 funds have fared much better. But you have to wonder why he's selling. I doubt he's having financial difficulties. Perhaps he sensed the Degas market heading south. Does anyone really own art at that level for the sake of art?

For more:
- here's the article

KKR's timing stokes questions

Jim Kim — Sun, 07 Sep 2008 09:01:10 -0400

The New York Times weighs in with a lengthy piece on Kohlberg's Kravis Roberts decision to go public via a reverse merger with its Dutch financial affiliate. It notes that Henry Kravis has been thinking about how to go public for about five years. It offers an interesting account of how the decisions was made. In the end, it seem like a decision borne of a problem: what to do with KKR Financial, which was really tanking in Amsterdam. That, and the fact that the Blackstone Group had already gone public, and thus acquired a valuable currency to make deals and lure talent. KKR just might want to make some definitive moves to make the firm a more diversified company. We'll see if the timing is right.

For more:
- here's the article

Fortune Power 25 short on bank execs

Wed, 30 Apr 2008 06:59:56 -0400

The most powerful business people on the planet. You might think that the financial world would be well represented. Perhaps two years ago, they would have been more plentiful on the list. But only four financial services executives made the list. Goldman Sachs' CEO Lloyd Blankfein was the highest ranking Wall Street-er, coming in at No. 3. Jamie Dimon, something of an upstart among elite powerbrokers, arrived at 15. Steven Schwarzman, CEO of the Blackstone Group, came in 19th. Henry Kravis, of Kohlberg Kravis Roberts, did not make the list at all. Steve Feinberg CEO of Cerberus came in 21--something of a surprise. Obviously, this is subjective stuff. But it speaks to the current state of the industry.

For more:
- here's the Fortune package

Related Article:
2008 CEO Watch

The biggest earners on Wall Street in 2007

Mon, 21 Apr 2008 06:59:56 -0400

We all know about hedge fund manager John Paulson's $3 billion take in 2007. Chances are you've heard of George Soros' stunning $2.4 billion or so take, as well. You would think the Forbes list of top earners would be interesting because it goes beyond hedge fund managers, but the first 15 spots are taken by just those (the usual suspects: Steve Cohen, T. Boone Pickens, and the like). The private equity crowd also was represented, with Steven Schwarzman of the Blackstone Group placing 16th, and Henry Kravis and George Roberts of Kohlberg Kravis Roberts placing 18th and 19th.

For more:
- here's the Forbes article and list

All you want to know about Schwarzman

Thu, 07 Feb 2008 06:59:57 -0500

Steven Schwarzman has become an icon of the private equity industry with perhaps a single peer. (That would be Henry Kravis.) So when the New Yorker decides to publish a nearly 11,000 word profile, it signals something significant about the man of the moment. It's hardly a glowing profile, but you get the feeling he might be relieved. Sure, the author talks about some of his PR problems, noting that Schwarzman is pondering a massive philanthropic gift to "silence his critics." That sort of stuff. But you have to wonder if this also signals the high water point for the Blackstone Group. We'll see.

For more:
- here's the New Yorker article

Protestors target Henry Kravis

Thu, 06 Dec 2007 06:59:58 -0500

We've noted before that it does not appear as if the anti-private equity crowd has succeeded in creating a populist movement. But it will not be for lack of effort by some, notably the SEIU. Now comes a short movie: "The War on Greed, Starring the Homes of KKR's Henry Kravis," which the New York Times calls "Lifestyles of the Rich and Famous" meets "Roger & Me." The movie, not related to SEIU's efforts, details Kravis's lifestyle and contrasts it with those of working people. A sidewalk screening is planned for the front of Kravis' New York residence. Three more movies are in the works. This is a PR issue for the entire industry to say the least.

For more:
- here's the New York Times item

Related articles:
- Ranking the top investors
- Henry Kravis, lobbyist
- Henry Kravis back on top?

Private equity tax hike proposal fizzles

Tue, 09 Oct 2007 06:59:58 -0400

I had been predicting that the much-feared hike on private equity gains would never really materialize. And I was right, not to sound too cocky. According to the Washington Post, private-equity firms have been informed that a tax-hike proposal will not get through the Senate this year. So the tax battle for the year is over, with the private equity firms winning. The issue remains whether it will re-ignite as an issue next year. My sense is that it will not. The major candidates do not want to make it an issue, and there is a whole lot of lobby power being directed toward preserving the low-tax treatment. But let it be said, the mere whiff off a tax change scared the bejeezus out of the industry. We may see the likes of Henry Kravis on Capitol Hill again, as a preventative measure.

For more:
- here's the Post article

Related articles:
- Private equity turns taxes into civil rights issue
- A clarification on the private equity tax debacle
- Another tax-hike bill is launched; class warfare?

Ranking the top investors

Mon, 16 Jul 2007 20:01:37 -0400

Business Week Online takes a look at the world's top investors and asks: What separates the billionaires from the millionaires? Each saw and acted on an opportunity before anyone else. Think about John Templeton's global investing and David Shaw's tech-based investing. Most of them think very long-term, even though some, like George Soros, made lots on single trades. When you take the group as whole, they are remarkably diverse. The ten biggest brains in investing? John Bogle, Buffet, Shaw, Ken Heebner, Bill Gross, Templeton, Carl Icahn, David Swenson, George Soros, Stephen Schwarzman. What no Henry Kravis? The one you may not know is Swenson, the 53-year old chief investment officer of the Yale University Endowment Fund.

For more:
- here's the list
- here's the story

The real likelihood of higher taxes on rate hikes

Wed, 11 Jul 2007 20:01:37 -0400

The private equity industry is certainly mobilizing. Their footprint is being felt in Washington, as evidenced by Henry Kravis paying a visit to key Congressmen. So what are the chances the industry will prevail. Pretty good really. The Senate has been anything but enthusiastic about tax hikes, and the industry appears to be targeting members of Congress who depend on the industry (or really any partnership) or have benefited via job gains. John Kerry told the AP that he had to weigh the revenue against the effects on venture capital flows. All in all, any bill will have to be narrowly drawn or you will invoke the wrath of all partnership-oriented industries. Right now, I would say the industry's chances of escaping higher taxes are pretty good. But this far from over.

For more:
- here's the AP article