KKR shelves $500 million stock offering citing market conditions

KKR cancels plans for $500 million stock offering

NEW YORK — KKR & Co. LP, the parent company of private equity firm Kohlberg Kravis Roberts, shelved plans for a $500 million stock offering, citing unfavorable market conditions.

The company on Monday reported that net income tumbled to $29.9 million in the quarter ended June 30 from $365.8 million the year earlier, in part because of the cost of issuing stock as compensation.

Economic net income, the key financial measure for private equity firms, fell 29 percent to $433.1 million in the second quarter, down from $613.5 million a year ago on a pro forma basis, for what would have been the combined business of KKR & Co. and its European arm.

The company first said it might raise $500 million in a share offering when it listed on the New York Stock Exchange in July.

However, shares have dropped about 6 percent since July, closing at $9.89 Monday.

KKR buys companies and then sells them to the public or other investors.

In November, it took discount retailer Dollar General Corp. public. In January, it acquired British pet retailer Pets At Home. Its holdings include retailer Toys R Us Inc. and hospital operator HCA Inc., both of which have filed plans for initial public offerings.

As of June 30, KKR had assets under management of $54.4 billion, up from $46.9 billion a year ago, but down slightly from the $54.7 billion at the end of the first quarter.