Henry Kravis - A Pioneer in Buyouts

Henry Kravis co-founded Kohlberg, Kravis,The failing credit market impeded future deals, as
Roberts & Co. and pioneered the buyout businesswell as threatened to break deals that were in
in the 1970s. He has managed to stay at the topthe process of being negotiated. The subsequent
of his field for over three decades now.mortgage issues managed to delay his plans to
Beginningstake KKR public. Also damaged by the credit crisis
Henry Kravis attended a prep school inwas KKR Financial, an affiliated mortgage-related
Connecticut as a child and headed off tosecurities investment fund. In 2008, Kravis sold
Claremont McKenna in California. Reportedly,off Kohlberg, Kravis, and Roberts' controlling stake
Henry spent his freshman year without muchin the company.
focus. However, by his senior year, Henry KravisRetirement
managed to turn things around and earned a spotHenry Kravis retired in 1987, but his name is still
at Columbia Business School. He later ended up atembossed on his old office door. The third
Bear Stearns with thanks going to an interveningfounding member of KKR, George Roberts,
cousin, George Roberts, who worked at the firm.continues to work at the company, with his main
Jerome Kohlberg became a mentor to both menbase of operations being located in Menlo Park.
and taught them about leveraged buyouts (LBO),Personal Causes
or "bootstrap acquisition." Later all three menHenry Kravis has been the city's most active
joined forces to found Kohlberg, Kravis, Robertsphilanthropist and has been a board member at
& Co., an early pioneer in the LBO business.Mount Sinai since 1981. In 1988, he donated $10
One of the most notable contributions by Henrymillion dollars to Mount Sinai and has since
Kravis for KKR was a $31 billion hostile takeovercontributed millions more, including a $15 million
of RJR Nabisco. This feat was later chronicled bydollar contribution in 2002 to fund the hospital's
John Helyar and Bryan Burrough in Barbarians AtValentin Fuster-led heart center. In 2006, Henry
The Gate. This accomplishment transformed himdonated over $10 million dollars to the Columbia
into one of the most prominent financiers of hisBusiness School and has underwritten a wing at
time. Nearly thirty decades after its originalthe Metropolitan Museum, as well as two galleries
founding, KKR remains one of the top companiesat MoMA.
in private equity circles.Campaign Support
NotableAs a reliable Republican party donor, Henry Kravis
In 2006, Henry Kravis orchestrated a $33 billionactively raised money for both of President
dollar deal to acquire the country's largest chain ofGeorge Bush's campaigns and played a part in
hospitals, HCA and then further impressed hisorganizing the Republican convention in New York
colleagues with a $45 billion dollar buyout of thein 2004. When 2007 arrived, Henry announces his
energy company TXU combined with TPG andofficial support for Senator John McCain and
Goldman Sachs.additionally signed on as New York state's
During the summer of 2007, the often franticfundraising co-chair.
deal-making stance of KKR came to a quick halt.