UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
| (Address of principal executive offices) | (Zip Code) |
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act: None
| Title of each class |
Trading |
Name of each exchange on which registered | ||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to section 13(a) of the Exchange Act.
| Item 8.01. | Other Events |
Transactional Net Asset Value
On July 21, 2023, KKR Infrastructure Conglomerate LLC’s (the “Company”) manager determined the transactional net asset value, being the price at which the Company sells and repurchases its shares (the “Transactional Net Asset Value”), of the following classes of the Company’s shares as of June 30, 2023:
| Class |
Transactional Net Asset Value per Share |
|||
| Class R Shares |
$ | 26.15 | ||
| Class U Shares |
$ | 26.14 | ||
| Class E Shares |
$ | 26.34 | ||
| Class G Shares |
$ | 26.35 | ||
| Class H Shares |
$ | 26.35 | ||
As of June 30, 2023, the Company had not sold any Class S, Class D, Class I, Class R-D, or Class F shares. The issuance price is $26.15 for Class S, Class D, Class I and Class R-D shares and is $26.34 for Class F shares and, in each case, is based on the Company’s aggregate net asset value per share as of June 30, 2023.
The Transactional Net Asset Value of the Company’s shares is also available on its website at www.kinfra.com, but the contents of the website are not incorporated by reference in or otherwise a part of this Current Report on Form 8-K.
For additional information, please see additional details included in Exhibit 99.1 to this Current Report on Form 8-K, which is incorporated herein by reference.
Class E Share Repurchase
On June 30, 2023, pursuant to the KKR Share Repurchase Arrangement, the Company repurchased 7,800,000 Class E Shares of the Company from KKR Alternative Assets LLC at a price of $25.00 per share, for an aggregate purchase price of $195,000,000.
| Item 9.01 | Financial Statements and Exhibits |
(d) Exhibits
| Exhibit Number |
Description | |
| 99.1 | Net Asset Value as of June 30, 2023 | |
| 104 | Cover Page Interactive Data File, formatted in Inline XBRL | |
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| KKR INFRASTRUCTURE CONGLOMERATE LLC | ||||||
| /s/ Jason Carss | ||||||
| Date: July 25, 2023 | Jason Carss | |||||
| General Counsel & Secretary | ||||||
Exhibit 99.1
Net Asset Value
We calculate net asset value per share in accordance with valuation policies and procedures that have been approved by our board of directors. Our transactional net asset value (“Transactional Net Asset Value”), being the price at which we sell and repurchase our shares, and GAAP net asset value (“GAAP Net Asset Value”), being our net asset value determined in accordance with accounting principles generally accepted in the United States of America (“GAAP”), presented in the following tables includes the net asset value of outstanding shares as of June 30, 2023. The following table provides a breakdown of the major components of our Transactional Net Asset Value as of June 30, 2023 ($ in thousands):
| Components of Transactional Net Asset Value |
June 30, 2023 | |||
| Investments at fair value |
$ | 475,436 | ||
| Cash and cash equivalents |
4,247 | |||
| Other assets |
12,995 | |||
| Other liabilities |
(20,363 | ) | ||
| Accrued performance participation allocation |
(1,315 | ) | ||
| Management fee payable |
(175 | ) | ||
| Accrued shareholder servicing fees and distribution fees (1) |
(93 | ) | ||
|
|
|
|||
| Transactional Net Asset Value |
$ | 470,732 | ||
|
|
|
|||
| Number of outstanding shares |
17,930,417 | |||
|
|
|
|||
| (1) | Shareholder servicing fees apply only to Class S, Class U, Class D and Class R-D shares. Distribution fees apply only to Class S shares and Class U shares. For purposes of Transactional Net Asset Value, we recognize shareholder servicing fees and distribution fees as a reduction to Transactional Net Asset Value on a monthly basis as such fees are accrued. For purposes of GAAP Net Asset Value, we accrue the cost of the shareholder servicing fees and distribution fees, as applicable, for the estimated life of the shares as an offering cost at the time we sell Class S, Class U, Class D and Class R-D shares. As of June 30, 2023, we have accrued under GAAP $8,822,000 of shareholder servicing fees and distribution fees payable to the dealer manager related to the Class U shares sold. |
| Reconciliation | of Transactional Net Asset Value to GAAP Net Asset Value |
The following table reconciles GAAP Net Asset Value per our Statement of Assets and Liabilities to our Transactional Net Asset Value ($ in thousands):
| June 30, 2023 | ||||
| GAAP Net Asset Value |
$ | 461,910 | ||
| Adjustment: |
||||
| Accrued shareholder servicing fees and distribution fees |
8,822 | |||
| Transactional Net Asset Value |
470,732 | |||
The following table provides a breakdown of our total Transactional Net Asset Value and our Transactional Net Asset Value per share by class as of June 30, 2023 ($ in thousands, except shares and per share data):
|
Transactional Net Asset Value Per Share |
Class R Shares | Class U Shares | Class E Shares | Class G Shares | Class H Shares | Total | ||||||||||||||||||
| Monthly Transactional Net Asset Value |
$ | 77,351 | $ | 131,004 | $ | 262,375 | $ | 1 | $ | 1 | $ | 470,732 | ||||||||||||
| Number of outstanding shares |
2,957,453 | 5,012,365 | 9,960,519 | 40 | 40 | 17,930,417 | ||||||||||||||||||
| Transactional Net Asset Value per share as of June 30, 2023 |
$ | 26.15 | $ | 26.14 | $ | 26.34 | $ | 26.35 | $ | 26.35 | ||||||||||||||
Valuation Methodologies and Significant Inputs
The following table presents additional information about valuation methodologies and significant inputs used for Infrastructure Assets that are valued at fair value as of June 30, 2023:
| Valuation Methodology |
Unobservable Input(s) (1) |
Weighted Average (2) |
Range | |||
| Inputs to market comparables, discounted cash flow and transaction price/other |
Illiquidity Discount | 5.0% | 5.0% - 5.0% | |||
| Weight Ascribed to Market Comparables | 16.4% | 0.0% - 25.0% | ||||
| Weight Ascribed to Discounted Cash Flow | 83.6% | 75.0% - 100.0% | ||||
| Weight Ascribed to Transaction Price/Other | — | Not applicable | ||||
| Market Comparables |
Enterprise Value / Forward EBITDA Multiple | 10.7x | 10.3x - 11.0x | |||
| Discounted Cash Flow |
Weighted Average Cost of Capital | 8.3% | 6.7% - 10.1% | |||
| Enterprise Value / LTM EBITDA Exit Multiple | 10.3x | 9.5x - 11.5x |
| (1) | Inputs are weighted based on fair value of the investments included in the range. |
| (2) | In determining the inputs, management evaluates a variety of factors including economic conditions, industry and market developments, market valuations of comparable companies, and company-specific developments including exit strategies and realization opportunities. The Company’s manager (the “Manager”) has determined that market participants would take these inputs into account when valuing the investments. “LTM” means Last Twelve Months. |
The Manager is ultimately responsible for our net asset value calculations.
Valuations involve subjective judgments and may not accurately reflect realizable value. The assumptions above are determined by the Manager and reviewed by our independent valuation advisor. A change in these assumptions or factors would impact the calculation of the value of our assets. For example, assuming all other factors remain unchanged, the changes listed below would result in the following effects on our asset values:
| Input |
Hypothetical Change | Infrastructure Asset Values | ||||||
| Weighted Average Cost of Capital |
0.25 | % decrease | +2.25 | % | ||||
| 0.25 | % increase | -2.45 | % | |||||
Document and Entity Information |
Jul. 21, 2023 |
|---|---|
| Cover [Abstract] | |
| Amendment Flag | false |
| Entity Central Index Key | 0001948056 |
| Document Type | 8-K |
| Document Period End Date | Jul. 21, 2023 |
| Entity Registrant Name | KKR Infrastructure Conglomerate LLC |
| Entity Incorporation State Country Code | DE |
| Entity File Number | 000-56484 |
| Entity Tax Identification Number | 92-0477563 |
| Entity Address, Address Line One | 30 Hudson Yards |
| Entity Address, City or Town | New York |
| Entity Address, State or Province | NY |
| Entity Address, Postal Zip Code | 10001 |
| City Area Code | (212) |
| Local Phone Number | 750-8300 |
| Written Communications | false |
| Soliciting Material | false |
| Pre Commencement Tender Offer | false |
| Pre Commencement Issuer Tender Offer | false |
| Entity Emerging Growth Company | true |
| Entity Ex Transition Period | false |
-8?20$3;
M8T.P6BP^0"X99K>]9!:G