PHILADELPHIA and NEW YORK, Dec. 11,
2017 /PRNewswire/ -- FS Investments, a leading alternative
investment manager, and KKR, a leading global investment firm,
today announced that they have entered into an agreement to create
the largest business development company (BDC) platform, with
$18 billion in combined assets under
management. The platform will offer differentiated
origination capabilities and expertise in capital markets that
provides sponsors and corporates with broad product solutions and
delivers value to investors through enhanced deal flow and expanded
proprietary investment opportunities.
"As the market has evolved, we've recognized the need to also
evolve our approach to the business and we believe this partnership
with KKR provides the scale, infrastructure and credit expertise
necessary to succeed as an investor in the private credit markets,"
said Michael Forman, Chairman and
Chief Executive Officer of FS Investments. "We are excited to
partner with KKR, a leader in the alternative asset management
industry, to create the preeminent BDC platform."
Todd Builione, Chief Executive
Officer of CCT and President of KKR Credit and Markets, said, "We
are very much looking forward to working closely with our partners
at FS Investments. Through our collective scale, we believe
we will be able to offer enhanced opportunities for value to our
investors – and more holistic financing solutions to our sponsor
and corporate clients. This partnership also represents a
substantial milestone for KKR Credit, growing our assets under
management by 33% to $55
billion."
Under the terms of the agreement, FS Investments and KKR will
seek stockholder approval for the partnership to provide investment
advisory services to the BDCs that FS Investments sponsors, FS
Investment Corporation (NYSE: FSIC) (FSIC), FS Investment
Corporation II (FSIC II), FS Investment Corporation III (FSIC III),
and FS Investment Corporation IV (FSIC IV), and to the BDC
currently advised by KKR, Corporate Capital Trust, Inc. (NYSE: CCT)
(CCT). Corporate Capital Trust II (CCT II), currently advised by
CNL and sub-advised by KKR, will also be offered the opportunity to
be included subject to board and shareholder approval. The FSIC
funds will be able to co-invest with KKR's other funds and
accounts.
Timeframe for Transition
The board of directors or
trustees have approved the new investment advisory agreements for
each FSIC fund and CCT, and each fund will seek stockholder
approval. The funds currently intend to begin soliciting
stockholder approval of the new investment advisory agreements, as
applicable, in January 2018.
KKR will provide non-advisory services to FS Investments through
a sourcing and administrative services agreement until stockholder
approvals for the new investment advisory agreements are
obtained.
As part of this transaction, FS Investments and GSO Capital
Partners (GSO) have entered into an agreement to conclude their
relationship with respect to all of FS Investments' sponsored funds
sub-advised by GSO. FS, GSO and KKR will work together to
facilitate a smooth transition.
"Our partnership with GSO has created significant value for our
investors and borrowers," added Forman. "We thank GSO for its
sub-advisory services and commitment to ensure a seamless transfer
of advisory responsibilities."
FSIC Conference Call
FSIC will host a conference call
at 9:00am (Eastern Time) today,
December 11, 2017, to discuss today's
announcement. All interested parties are welcome to participate and
can access the conference call by dialing (877) 443-2408 and using
the conference ID 7356669 approximately 10 minutes prior to the
call.
A joint slide presentation containing supplemental information
from FSIC and CCT will be referenced on the conference call and
also has been posted to www.fsinvestmentcorp.com and
www.corporatecapitaltrust.com.
CCT II investors will receive information and company updates
via postings to www.corporatecapitaltrustii.com.
CCT Conference Call
CCT will host a conference call at
10:00am (Eastern Time) today,
December 11, 2017, to discuss today's
announcement. The conference call may be accessed by dialing (833)
818-6808 (U.S. callers) or +1(409) 350-3502 (non-U.S. callers); a
passcode is not required. Additionally, the conference call
will be broadcast live over the Internet and may be accessed at
http://corporatecapitaltrust.com/investor-relations/events-presentations/.
A replay of the live broadcast will be available on CCT's website
or by dialing (855) 859-2056 (U.S. callers) or +1(404)
537-3406 (non-U.S. callers), pass code 9698498, beginning
approximately two hours after the broadcast.
Additional Announcements from FS
Investments
Separately, FS Investments also announced that
it has entered into an agreement to create a joint venture with EIG
Global Energy Partners to provide investment advisory services to
FS Energy and Power Fund, and the firm has hired a seasoned liquid
credit portfolio manager to manage FS Global Credit Opportunities
Fund.
Additional information regarding these announcements can be
accessed at www.fsproxy.com and www.fsinvestments.com.
This announcement does not impact FS Investments' other funds:
FS Credit Income Fund, FS Credit Real Estate Income Trust, Inc., FS
Energy Total Return Fund and FS Multi-Strategy Alternatives
Fund.
About FS Investments
FS Investments is a leading asset
manager dedicated to helping individuals, financial professionals
and institutions design better portfolios. The firm provides access
to alternative sources of income and growth and focuses on setting
industry standards for investor protection, education and
transparency.
FS Investments is headquartered in Philadelphia, PA with offices in New York, NY, Orlando, FL and Washington, DC. Visit fsinvestments.com to
learn more.
About KKR
KKR is a leading global investment firm
that manages multiple alternative asset classes, including credit,
private equity, energy, infrastructure and real estate, and,
through its strategic manager partnerships, hedge funds. KKR aims
to generate attractive investment returns by following a patient
and disciplined investment approach, employing world-class people,
and driving growth and value creation with KKR portfolio companies.
KKR invests its own capital alongside its partners' capital and
provides financing solutions and investment opportunities through
its capital markets business. References to KKR's investments may
include the activities of its sponsored funds. For additional
information about KKR & Co. L.P. (NYSE: KKR), please
visit KKR's website at www.kkr.com and on Twitter
@KKR_Co.
Contact Information:
FSIC Investors
Chris
Condelles
christopher.condelles@fsinvestments.com
267-439-4365
Dominic Mammarella
dominic.mammarella@fsinvestments.com
215-220-4280
FSIC II, FSIC III and FSIC IV
Investors
833-536-4196
CCT Investors
Danny
McMahon or Donna Bass
CCT-IR@kkr.com
212-230-9471
CCT II Investors
CNL Client Services
info@cnl.com
866-650-0650, option 2
KKR Investors
Craig
Larson
Investor-Relations@kkr.com
212-230-9410
Media (FS Investments)
Marc
Yaklofsky or Kate Beers
media@fsinvestments.com
215-495-1174
Media (KKR)
Kristi Huller or Cara Kleiman
media@kkr.com
212-750-8300
Additional Information and Where to Find
It
This communication relates to
proposed new investment advisory agreements for the funds
(collectively, the Proposals). In connection with the
Proposals, each Fund intends to file relevant materials with the
Securities and Exchange Commission (the SEC), including a proxy
statement on Schedule 14A (Proxy Statement). This
communication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any vote or approval. No offer of securities shall be made
except by means of a prospectus meeting the requirements of Section
10 of the Securities Act of 1933, as amended. STOCKHOLDERS OF THE
FUNDS ARE URGED TO READ ALL RELEVANT DOCUMENTS FILED WITH THE SEC,
INCLUDING ANY PROXY STATEMENT, BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSALS. Investors and security
holders will be able to obtain the documents filed with the SEC
free of charge at the SEC's web
site, http://www.sec.gov and from FS Investments' website
at www.fsinvestments.com, FSIC's website at
www.fsinvestmentcorp.com or CCT's website at
www.corporatecapitaltrust.com.
Participants in the Solicitations
The funds and their
respective directors, trustees, executive officers and certain
other members of management and employees, including employees of
FS Investments, KKR and their respective affiliates, may be deemed
to be participants in the solicitation of proxies from the
stockholders of the funds in connection with the
Proposals. Information regarding the persons who may, under
the rules of the SEC, be considered participants in the
solicitation of the funds' stockholders in connection with the
Proposals will be contained in the Proxy Statements when such
documents become available. These documents may be obtained free of
charge from the sources indicated above.
Forward-Looking Statements
This announcement may
contain certain "forward-looking" statements as that term is
defined in Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended
by the Private Securities Litigation Reform Act of 1995, including
statements with regard to future events or the future performance
or operations of the funds, FSEP, FSGCO and KKR (the FLS Entities).
Words such as "believes," "expects," "projects," and "future" or
similar expressions are intended to identify forward-looking
statements. These forward-looking statements are subject to the
inherent uncertainties in predicting future results and conditions.
Certain factors could cause actual results to differ materially
from those projected in these forward-looking statements. Factors
that could cause actual results to differ materially include
changes in the economy, risks associated with possible disruption
an FLS Entity's operations or the economy generally due to
terrorism or natural disasters, future changes in laws or
regulations and conditions in an FLS Entity's operating area,
failure to obtain requisite stockholder approval for the proposals
set forth in a Proxy Statement, failure to consummate the
transactions contemplated by the master agreement between FS
Investments and KKR and the price at which shares of FSIC's, CCT's
or KKR's common stock trade on the New York Stock Exchange. Some of
these factors are enumerated in the filings the FLS Entities make
with the SEC and will also be contained in the Proxy Statements
when such documents become available. The inclusion of
forward-looking statements should not be regarded as a
representation that any plans, estimates or expectations will be
achieved. Any forward-looking statements speak only as of the date
of this communication. The FLS Entities undertake no obligation to
update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. Readers are
cautioned not to place undue reliance on any of these
forward-looking statements.
SOURCE FS Investments