KKR invests $700m in Sun Microsystems
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.Sun Microsystems, the Nasdaq-quoted manufacturer of computer servers, has received a $700m (£350m) investment from Kohlberg Kravis Roberts, in a move described yesterday as a surprising foray into the public markets for the private equity powerhouse.
The cash comes from the KKR Private Equity Investors fund, KKR's first public fund, which raised $5bn last year and floated on Amsterdam's Euronext.
The fund was touted at the time as an opportunity for public market investors to gain exposure to the booming world of private equity.
Sun said yesterday that it returned to profit in the final three months of 2006. Its suite of high-end systems for business customers had lost out to cheaper off-the-peg rivals from Hewlett-Packard and others, but the company has recovered because of cost-cutting and new, less costly products.
Both sides were vague on what Sun would use the investment for, beyond pursuing "strategic growth opportunities".
George Roberts - the R in KKR - said: "Jonathan Schwartz [Sun's chief executive] and his team have demonstrated remarkable vision and strong discipline in executing its turnaround strategy."
The investment is in new convertible bonds exchangeable for Sun shares over the next seven years. While the KKR fund has pledged to invest three-quarters of its money in KKR-sponsored private equity deals, the Sun deal is now its biggest single investment.
It comes as investors are questioning whether the private equity boom could be derailed by rising interest rates and soaring competition for private assets, which is pushing prices higher.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments