SAN FRANCISCO, July 8, 2011 /PRNewswire/ -- KKR Financial Holdings LLC (NYSE: KFN) ("KFN" or the "Company") today announced that it has upsized KKR Financial CLO 2011-1, Ltd. ("CLO 2011-1") to $600 million from $400 million. The increase in the transaction size is a result of an amendment to the transaction whereby CLO 2011-1 is now able to borrow up to $450 million representing an increase of $150 million from what was previously available under the securitization. In addition, the Company increased its residual interest in the transaction from $100 million to $150 million through the acquisition of an additional $50 million of subordinated notes issued by CLO 2011-1. The cost of the financing remains three-month LIBOR plus 1.35%.
Concurrent with the amendment to increase the size of CLO 2011-1, the transaction was amended to reduce the par value ratio test (failure of which would cause up to 50% of all interest collections otherwise payable to the Company to be diverted until this test was brought into compliance) for CLO 2011-1 from 133.33% to 120%.
CLO 2011-1 initially closed on March 31, 2011 as a privately negotiated financing transaction between the Company and a third-party senior lender.
The Company's Chief Executive Officer, William C. Sonneborn, stated, "We are very pleased that we were able to upsize CLO 2011-1 as it represents a uniquely structured financing transaction through which we can continue to grow our senior secured loan portfolio at attractive terms with a partner."
About KKR Financial Holdings LLC
KKR Financial Holdings LLC is a specialty finance company with expertise in a range of asset classes. KFN's core business strategy is to leverage the proprietary resources of its manager with the objective of generating both current income and capital appreciation. KFN is externally managed by KKR Financial Advisors LLC, a wholly-owned subsidiary of KKR Asset Management LLC, which is a wholly-owned subsidiary of Kohlberg Kravis Roberts & Co. L.P. KFN executes its core business strategy through its majority-owned subsidiaries. Additional information regarding KFN is available at http://www.kkr.com.
Investor Relations Contact:
Kohlberg Kravis Roberts & Co.
Tel: +1 (415) 315-6567
Media Relations Contacts:
Kohlberg Kravis Roberts & Co.
Tel: + 1 (212) 750-8300
"Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995:
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on information available to the Company as of the date of this press release and actual results may differ. These forward-looking statements involve known and unknown risks, uncertainties and other factors beyond the Company's control. Any forward-looking statements speak only as of the date of this press release and the Company expressly disclaims any obligation to update or revise any of them to reflect actual results, any changes in expectations or any change in events. If the Company does update one or more forward-looking statements, no inference should be drawn that it will make additional updates with respect to those or other forward-looking statements. For additional information concerning risks, uncertainties and other factors that may cause actual results to differ from those anticipated in the forward-looking statements, and risks to the Company's business in general, please refer to the Company's SEC filings, including its Annual Report on Form 10-K for the fiscal year ended December 31, 2010, filed with the SEC on February 28, 2011 and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2011, filed with the SEC on May 2, 2011.
SOURCE KKR Financial Holdings LLC