KKR & Co. Inc. KKR has entered into a strategic partnership with Capital Group to augment alternative investment solutions for client portfolios. This move aims to make hybrid public-private market investment solutions available to investors across asset classes, channels and geographies.
The first two strategies are anticipated to be launched in the United States next year, incorporating public-private fixed-income offerings designed for finance professionals as well as for their clients. While the alternatives are accessible to high-net-worth individuals and accredited investors, mass affluent investors (constituting more than 40% of the global wealth market) have been deprived of this asset class. This strategic initiative paves the way for many finance professionals and their clients to access alternative investments and include them in their portfolios.
Mike Gitlin, president and CEO of Capital Group, said, “KKR is a leading and respected alternative asset manager with over $500 billion in assets, with a proven track record managing over $200 billion in credit. We believe combining our respective areas of expertise in strategies that are more liquid than standalone private credit can help our clients achieve their goals.”
“We will bring the strategies of a premium alternatives manager to our clients with a compelling fee and greater accessibility. Clients should think of this as ‘the best of both worlds’ – a hybrid investment solution that combines Capital’s active management and long-term investment approach with KKR’s private market expertise,” Gitlin added.
Global assets in alternatives have witnessed substantial growth over the last 20 years. The individual wealth invested in the asset class is projected to rise 12% annually over the next decade.
Eric Mogelof, partner and head of Global Client Solutions at KKR, said, “We are pleased with the momentum and growth that we’ve seen in our private wealth business and believe these new hybrid solutions will be a strong complement to our existing platform and offer a compelling way to bring the benefits of alternatives to an even wider audience of investors across wealth and retirement who may not have had access to them historically.”
This move aligns with KKR’s enhanced focus on alternative investment classes to deepen its market presence.
KKR has been engaged in expansionary initiatives in order to boost its client base as well as enhance its asset class offerings. This March, the company was part of a consortium to purchase GreenSky, a home-improvement lending platform from Goldman. In October 2023, the company announced expansion plans in India, with a new office launch in Gurugram.
Shares of this Zacks Rank #3 (Hold) company have jumped 50.6% in the past six months, outperforming the industry’s growth of 22.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Other Financial Services Firms Taking Business Restructuring Steps
Earlier this month, M&T Bank Corporation MTB announced the expansion of its utilization of the nCino platform and integration of the latter’s continuous credit monitoring solution into its operations.
MTB has been a longstanding customer of nCino. This AI-powered solution will allow the company to have access to additional data for making efficient decisions. Such innovative partnerships to use technology proficiently will prove to be a game changer for the bank and will transform its ways of managing credit risk and loan performance across its portfolio.
In February, Blackstone Inc. BX entered into a partnership with BNP Paribas SA BNPQY to form a new fund financed by French individuals. The aim of the fund will be to invest in companies in private debt.
This new France-dedicated fund, which is aimed at investing in middle-sized companies, fits well with BX’s group strategy of targeting individual investors. BNPQY and Blackstone said that clients of the French lender’s private bank unit and insurance division have benefited from an exclusivity period that ended on Apr 5 to invest in the fund.
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