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KKR’s Capital Market Division to Witness Growth in 2Q17

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Rising transaction fees

KKR & Company (KKR) generated total transaction fees of $243 million in 1Q17, reflecting a significant rise compared to the total transaction fees it generated in 4Q16.

This rise was mostly due to the performance of the company’s capital market division, which generated transaction fees of $121 million in 1Q17 on the back of a significant number of deployments.

KKR is expected to generate more transaction fees in its capital market division in 2Q17. The division will likely benefit from volatility in the broader market. The rise in realizations could also benefit the division in 2Q17.

Around 55% of the transaction fees that the company’s capital market division generated in 1Q17 came from outside the United States. The company’s third-party business contributed ~20% of its transaction fees.

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Expected revenue

KKR & Company is expected to post revenue of $0.30 billion in 2Q17, a fall of 19% compared to its 1Q17 revenue. Other alternative asset managers (XLF) are expected to post the following revenues in 2Q17:

  • Carlyle Group (CG): $0.66 billion
  • Blackstone (BX): $1.5 billion
  • Apollo Global Management (APO): $0.47 billion
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