Carlyle and KKR Strategic Partnerships Agree to Acquire Approximately $10.1 Billion Prime Student Loan Portfolio from Discover Financial Services
17 Luglio 2024 - 2:59PM
Business Wire
Global investment firms Carlyle (NASDAQ: CG) and KKR (NYSE: KKR)
today announced that one or more strategic partnerships comprised
of funds and accounts managed by Carlyle and KKR’s respective
credit businesses have agreed to purchase an approximately $10.1
billion portfolio of prime student loans from Discover Financial
Services (NYSE: DFS).
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“This acquisition highlights Carlyle’s proven expertise in
private student loans and asset-backed finance, demonstrating our
Global Credit business’s ability to provide scaled, tailored
solutions to meet our clients’ dynamic needs,” said Akhil Bansal,
Head of Credit Strategic Solutions at Carlyle. “As the lending
space evolves, we believe private markets are well-positioned to
offer financial institutions increased flexibility amidst this
transformation.”
“We are pleased to leverage our scale, deep experience in ABF
investing and capital markets capabilities to be a capital
solutions provider of choice to financial institutions that are
focusing on optimizing their balance sheets,” said RJ Madden, a
Managing Director at KKR. “This transaction demonstrates the value
that scaled private lenders can bring to key areas of the economy
as the priorities of traditional lenders continue to evolve.”
“We're very pleased to consummate this transaction with two
outstanding strategic partners in Carlyle and KKR," said Dan
Capozzi, Executive Vice President and President of Consumer Banking
at Discover. "This agreement represents an important milestone in
our journey to simplify our operations and business mix.”
Carlyle’s investment in the portfolio was led by its Credit
Strategic Solutions (“CSS”) team, a group within its Global Credit
business focused on asset-backed investments. The highly
experienced team seeks to leverage the knowledge, sourcing,
structuring, and breadth of the entire Carlyle investment platform
to deliver tailored asset-focused financing solutions to
businesses, specialty finance companies, banks, asset managers, and
other originators and owners of diversified pools of assets.
KKR’s investment in the portfolio comes primarily from its
asset-based finance strategy and other credit vehicles and
accounts. KKR has made more than 80 ABF investments globally since
2016 through a combination of portfolio acquisitions, platform
investments and structured investments. The firm has approximately
$54 billion in ABF assets under management and a team of more than
50 professionals directly involved in the ABF effort globally.
The transaction is expected to close by the end of 2024 subject
to customary closing conditions.
KKR Capital Markets and TCG Capital Markets structured and
arranged the debt for the transaction. Monogram LLC, a portfolio
company of Carlyle, will serve as portfolio manager for the student
loan portfolio. Firstmark Services, a subsidiary of Nelnet, Inc.
will service the loans in the portfolio. Sidley Austin LLP served
as legal advisor to KKR and Carlyle. Paul Hastings LLP also served
as a legal advisor to Carlyle and Clifford Chance LLP also served
as a legal advisor to KKR. Wells Fargo served as exclusive
financial advisor, and Skadden, Arps, Slate, Meagher & Flom LLP
served as legal counsel to Discover Financial Services in
connection with the transaction.
About Carlyle
Carlyle (NASDAQ: CG) is a global investment firm with deep
industry expertise that deploys private capital across three
business segments: Global Private Equity, Global Credit and Global
Investment Solutions. With $425 billion of assets under management
as of March 31, 2024, Carlyle’s purpose is to invest wisely and
create value on behalf of its investors, portfolio companies and
the communities in which we live and invest. Carlyle employs more
than 2,200 people in 28 offices across four continents. Further
information is available at www.carlyle.com. For more, follow
Carlyle on X and LinkedIn.
About KKR
KKR is a leading global investment firm that offers alternative
asset management as well as capital markets and insurance
solutions. KKR aims to generate attractive investment returns by
following a patient and disciplined investment approach, employing
world-class people, and supporting growth in its portfolio
companies and communities. KKR sponsors investment funds that
invest in private equity, credit and real assets and has strategic
partners that manage hedge funds. KKR’s insurance subsidiaries
offer retirement, life and reinsurance products under the
management of Global Atlantic Financial Group. References to KKR’s
investments may include the activities of its sponsored funds and
insurance subsidiaries. For additional information about KKR &
Co. Inc. (NYSE: KKR), please visit KKR’s website at www.kkr.com.
For additional information about Global Atlantic Financial Group,
please visit Global Atlantic Financial Group’s website at
www.globalatlantic.com.
About Discover Financial
Discover Financial Services (NYSE: DFS) is a digital banking and
payment services company with one of the most recognized brands in
U.S. financial services. Since its inception in 1986, the company
has become one of the largest card issuers in the United States.
The company issues the Discover® card, America's cash rewards
pioneer, and offers personal loans, home loans, checking and
savings accounts and certificates of deposit through its banking
business. It operates the Discover Global Network® comprised of
Discover Network, with millions of merchants and cash access
locations; PULSE®, one of the nation's leading ATM/debit networks;
and Diners Club International®, a global payments network with
acceptance around the world. For more information, visit
www.discover.com/company.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240717003713/en/
Media Contacts: For Carlyle: Kristen Ashton 212-813-4763
Kristen.ashton@carlyle.com
For KKR: Julia Kosygina 212-230-9722 media@kkr.com
For Discover Financial: Matthew Towson 224-405-5649
matthewtowson@discover.com
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