KKR Mezz Fund Takes Shape

Kohlberg Kravis Roberts is the latest entrant into the mezzanine space. The firm, which launched a new fund under the umbrella of its KKR Asset Management arm, recently held a first close of roughly $330 million for KKR Mezzanine Partners I, LP. A target for the new vehicle was not disclosed in the filing.

KKR's efforts in the mezz segment are being spearheaded by Frederick Goltz, who has been with the firm since 1995. Goltz helped oversee many of KKR's investments in the energy space, such as its acquisitions of Texas Genco and Energy Future Holdings.

KKR launched the asset management platform in 2004, and has since introduced a distressed debt and leveraged finance capabilities. Headed by former TCW Group president Bill Sonneborn, KKR Asset Management oversees roughly $13 billion in total assets.

The mezz team, meanwhile, continues to grow. Most recently, Marc Ciancimino assumed a post in London, Doug Tapley joined the San Francisco office, and Lee Stern was added to the team in New York.

Published reports have identified a $1 billion target for the vehicle. In the filing, however, the cap was listed as "indefinite."

A spokesman for KKR declined to comment about the fundraise.

The mezzanine segment, in the absence of CLOs, has seen substantial fundraising activity in recent months. Prudential, in January, closed its latest fund, topping its original $900 million target, while earlier this week ABRY Partners held a first, and only, close on its latest mezz vehicle.

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