NEW YORK (Reuters) – KKR Financial Holdings LLC (KFN.N), a debt fund managed by private equity firm Kohlberg Kravis Roberts & Co (KKR.AS), said on Monday it intends to sell $125 million of bonds that can be converted to equity.
The notes, due 2017, will be convertible into cash, common shares or a combination, at the company’s election.
It intends to use most of the net proceeds to repurchase or repay a portion of its existing senior debt, with the remaining proceeds to be used for general corporate purposes, it said.
KKR Financial also expects to report results for the fourth quarter ended Dec. 31 in the range of about 5 cents net loss per common share to 1 cent net income.
A year ago, KKR Rinancial reported a net loss of $7.85 per diluted common share for the quarter ended Dec. 31, 2008.
The expected loss for the most recent quarter is mainly due to charges it is recognizing on the value of its residential mortgage-backed securities (RMBS) portfolio and charges related to certain corporate loans, it said. (Reporting by Megan Davies; editing by Andre Grenon)