(This is the first in my series of profiles of big time private equity investors. I've done a piece on Ken Mehlman already, so I decided to continue with other major figures of KKR. Enjoy!)
Henry Kravis has mastered the art of leverage buyouts and takeovers. With George Roberts and Jerome Kohlberg, Henry Kravis founded KKR, a firm capitalizing on leverage buyouts and reselling companies for profit. Since its foundation, the firm has had more than 30 company buyouts and has invested over $90 billion in these ventures reaping profits for the firm and their investors. In 1987, Jerome Kohlberg retired from the firm and Kravis was left with his other partner, George Roberts. In 1988, the two of them led the takeover of RJR Nabisco for $25 billion dollars, the biggest acquisition of its kind during that time.
Henry Kravis graduated as an economics major at Claremont McKenna College and spent his summers working in Wall Street and companies like Goldman Sachs, where he learned the movements of the financial industry. After he graduated, Henry Kravis worked at Madison Fund where he fine-tuned his skills and knowledge of the financial industry. It was in this job that he learned decision making with regards to buying stocks and companies. He took his Masters degree at Columbia and went back to working for Madison Fund. He then transferred to Bear Sterns where he met Kohlberg and with Roberts, founded their own company in 1976. And the rest, as they say, is history.
Henry Kravis has been a staple in the Forbes list of richest Americans because he has continued to be passionate about his craft. Likewise, he remains one of the pioneers of leveraged buyouts. Alongside JP Morgan, he is considered one of those who significantly changed the financial industry landscape.
Taking over a company and turning it from struggling to profitable is a difficult task. A business venture is not like your normal walk in the park. It takes a lot of work; long and very hard work. It takes risks; risk that the company you obtain have a 50-50 chance of being a bomb. It takes research and carefully calculated moves. It is pressure exemplified. Henry Kravis, without a doubt, is the greatest master of this extremely difficult art.
Check out this great interview of Henry Kravis and George Roberts on YouTube.
