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Report: KKR to float A$500M credit income fund in Australia

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Report: KKR to float A$500M credit income fund in Australia

KKR & Co. Inc. is planning to list its A$500 million KKR Credit Income Fund on the Australian Securities Exchange in November, Reuters reported, citing two people with direct knowledge of the matter.

The credit fund is the first investment vehicle of the U.S. private equity firm in Australia. It seeks to meet investor demand for higher-yielding products, providing target annual dividend payments of 4% to 6%, sources said.

Proceeds from the public offering would go toward the firm's Global Credit Opportunities Fund and would be used to invest in its European Loan fund over time, they added.

The fund would charge 88 basis points in fees to pay for the listing's cost, which is approximately 2.5% of the funds raised, according to the sources.

Given the Australian central bank's move to cut its cash rate to 1% and financial futures pricing in two more cuts by mid-2020, brokers briefed on KKR's plans expected the fund to be well received, one of the people who attended the firm's presentations reportedly said.

A spokeswoman for KKR did not comment on the matter; however, she said that the firm was observing the "interesting space," the report noted.

It was recently reported that KKR, alongside its joint venture partners, is also looking to list Singapore-based online property portal PropertyGuru Pte. Ltd. in Australia later in 2019.