David Petraeus KKR - Blog Posts
Petraeus Op-ed on Iraq is the latest in his elaborate comeback
By Brian Jones, October 30th from Business Insider
America loves a comeback kid, and Former CIA Director and retired Army Gen. David Petraeus is on a comeback tour.
After resigning in disgrace as Director of the CIA last year because of an extra-martial affair, Petraeus has worked hard at getting back to a good place in the eyes of the American people.
The first step was a philanthropic tour as a professor at New York City's public university, for which he was paid just $1.
It didn't go as well as planned, as students affiliated virulently protested his presence there. Six were eventually arrested.
But why is Petraeus so invested in rehabilitating his image? Perhaps he is mulling a run for political office. Maybe he is just trying to protect a once virtually spotless legacy.
The keystone of that legacy is the belief that Petraeus won the war in Iraq. He commanded the war during President George W. Bush's "surge" and is widely heralded as the architect of the Counterinsurgency strategy that surge forces worked to implement.
Yesterday, Petraeus took the next step toward that end with an exhaustive, nearly 8,000 word op-ed in Foreign Policy called "How We Won In Iraq."
The timing is odd. Right now, Iraq is on fire. More than 7,000 civilians have been killed this year, a pretty clear indication that whatever perceived security gains were made prior to the 2011 withdrawal of U.S. combat forces were not sustainable. And so it's strange for Petraeus to take this moment to remind everyone about his greatest "success" in Iraq.
And yet he does, in dense fashion. Using the word "surge" 74 times.
"I recognized early on that I had become the face of the surge," he writes. "I had not asked for this role, but whether I liked it or not, I had to fill it."
He breaks his editorial down into sections:
The Surge of Forces and the Surge of Ideas
The Sunni Awakening and Reconciliation
Targeted Special Operations
The Development of Iraqi Security Forces
The Civilian Components
Detainee Operations and Rule-of-Law Initiatives
The Iraqi Political Component and Strategic Communications
The Magnitude of the Difficulty
Commanding MNF-I
The Road Ahead
Petraeus shows off his Ivy League doctorate in political science and years of first-hand experience in the region. And regardless of the motives, it's a remarkable account from the perspective of the general who ran the war — a rare historical insight.
He also addresses some of the more questionable and ambiguous history of U.S. operations in Iraq, including whether the surge precipitated the Anbar Awakening.
He concedes that the Anbar Awakening started before the surge, and before he arrived in the region, but he claims his strategies made it spread throughout Iraq.
"The spread of the Awakening was not serendipity; it was the result of a deliberate decision I took soon after taking command," he says.
But embracing the Awakening often meant forming alliances with the same people who had previously been fighting American forces for years. Petraeus acknowledged it was a tough sell to other military leaders.
"Many correctly pointed out that the leaders and members of the groups that wanted to reconcile with us groups that might be willing to embrace the Awakening ... had American blood on their hands."
Simultaneous to the surge, Petraeus, working with the then commander of the Joint Special Operations Command, a lieutenant general named Stanley McChrystal, expanded a program to capture or kill high-level operatives.
"Although I publicly acknowledged from the outset that we would not be able to kill or capture our way to victory (hence the need to support the Awakening)," Petraeus writes, "killing or capturing the most important of the 'irreconcilables' was an inescapable and hugely important element of our strategy."
He concluded by saying that Iraq has slipped back into chaos because the surge tactics stopped:
What mattered most was the surge of ideas -- concepts that embraced security of the people by "living with them," initiatives to promote reconciliation with elements of the population that felt they had no incentive to support the new Iraq, ramping up of precise operations that targeted the key "irreconcilables," the embrace of an enhanced comprehensive civil-military approach, increased attention to various aspects of the rule of law, improvements to infrastructure and basic services, and support for various political actions that helped bridge ethno-sectarian divides.
But Petraeus' account of the history of the war was immediately met with some criticism:
Chase Winter, an international development officer at the American University of Iraq, tweeted that Petraeus outlined "what we did to win, [without] defining winning."
"For Petraeus to write this while Iraq burns takes enormous balls," tweeted Joshua Foust, a former intelligence analyst and freelance journalist.
The claim that the surge worked in Iraq is a bit of a point of contention. An Army lieutenant colonel named Daniel Davis gained notoriety last year by publishing a blistering account of the war and said that any gains made were pure luck. Davis was deployed to Iraq from 2008-2009.
European Credit Manager Avoca Sells
The Europe's Avoca Capital Holdings is an employee owned investment management firm. They have recently announced that they will be selling to the American private equity firm KKR.
Avoca Capital Logo This sale should be a good deal for both companies, which should complement each other well. Fitch ratings claims that the transaction should not affect Avoca Capitals highest standard's asset manager rating. Fitch also claims there will be good synergy between the two companies. The combined assets of both firms is approximately $28 billion, of which $8 billion is under management by Avoca Capital. There may be some conflicts of interests between assets of the two firms but this should not create any major problems. Fitch believes that Avoca will grow supported by KKR's brand and distribution capability. In addition KKR will assist Avoca to meet new European risk retention regulations. These rules make operations more expensive for smaller firms who are unable to handle the burden. The operational transaction risk for the two companies is relatively low. Moving forward all Avoca staff will become KKR employees, however there will be no change in reporting lines or processes, systems or locations. Short term measures have been taken to retain senior Avoca staff through incentives. operational risk associated with transaction will be low. avoca staff will become kkr employees, but there will be no change in reporting lines processes, systems or locations on the short term. measures have been taken to incentivise the retention of senior staff.
Green Portfolio Surpasses Expectations.
Green Investor Alert: KKR's (NYSE:KKR) Green Portfolio Program Surpasses $900 Million in Financial Impact While Improving Environmental Performance of Private Equity Portfolio Companies
About KKR
Founded in 1976 and led by Henry Kravis and George Roberts, KKR is a leading global investment firm with $83.5 billion in assets under management as of June 30, 2013. With offices around the world, KKR manages assets through a variety of investment funds and accounts covering multiple asset classes. KKR seeks to create value by bringing operational expertise to its portfolio companies and through active oversight and monitoring of its investments. KKR complements its investment expertise and strengthens interactions with fund investors through its client relationships and capital markets platform. KKR & Co. L.P. is publicly traded on the New York Stock Exchange (NYSE:KKR), and "KKR," as used in this release, includes its subsidiaries, their managed investment funds and accounts, and/or their affiliated investment vehicles, as appropriate. For additional information, please visit KKR's website at www.kkr.com
KKR's continued asian adventure, this time India.
We have been following KKR's on going investment crusade in Asia. As part of their $6 billion dollar asian fund, the New York based firm has been investing all over the region. There is speculation that much of KKR's foreign investments are guided by its Global Institute.
Some of the countries they have so far invested in this year include Indonesia, Malaysia, Vietnam, China and Japan.
Now the firm is likely to announce in the coming weeks a major investment into India's Gland Pharmaceuticals. This deal would be worth around $150 million and would be the second sizable India investment in six months. In April KKR bought a controlling stake in India's Alliance Tire Group from Warburg Pincus LLC for what sources estimate to be around $500 million.
Gland Pharma was started in 1978 and makes active pharmaceutical ingredients and formulations for a number of different injections.
Investments have been falling in India. Compared to this time last year the amount of private equity investments has dropped 67%.
So the world is still moving despite everyone in the United States being pissed off at our politicians. For the last couple weeks we have been following KKR’s spending spree in Asia. KKR has been investing substantially in Asian markets, from China to Japan and now Indonesia. They have been...
KKR and Panasonic Agree on a Price
Earlier in the month we wrote about the announcement of the Panasonic health sale to private equity firm KKR. The sale has now been finalized, KKR will own 80% of the Panasonic healthcare unit for a price of $1.67 billion an Panasonic will hold the remaining 20%. Panasonic has lost more than $7 billion a year for the last two years on their healthcare unit. The chief executive of Panasonic when asked about his thoughts on KKR said, "We believe that partnering with K.K.R will also allow us to learn from K.K.R.'s global operational and business management expertise as we pursue the next stage of growth for Panasonic." KKR's founder Henry Kravis said in a statement that Japan was, "a very important and attractive market for K.K.R., and our experienced tam on the ground in Japan looks forward to leveraging KKR's Global expertise experience." Other notable leaders on KKR's global team include former General David Petraeusand former RNC Chairman Kenneth Mehlman.
http://aclassasset.blogspot.com/2013/10/kkr-and-panasonic-agree-on-price.html
Public Figures to Private Equity
In this series, we look through the most recent Dividend Channel ''DividendRank'' report, and then we cherry pick only those companies that have experienced insider buying within the past six months. The officers and directors of a company tend to have a unique insider's view of the business, and presumably [...]
KKR was named the top Dividend stock by Forbes. They also recently brought General David Petraeus on to head up their Global Division
Former General David Petraeus has left the military and taken a post at the private equity firm. Kohlberg Kravis and Roberts. In his new post Mr. Petraeus will serve as the chairman of the new KKR Global Institute. With the all of Petraeus's experience in the military he should be a valued asset to KKR.
General Petraeus Returns
By Mike Vilensky
Is David Petraeus KKR's Global Institute Chair stepping back into public life?
The former U.S. military general has kept a low profile since stepping down as director of the Central Intelligence Agency a year ago, but he turned up at a New York City gala in his honor Monday evening. "I am convinced that [Gen. Petraeus] has not served his last day in public service," said Jack Keane, another retired general. "He will be back, to be sure."
The New-York Historical Society bestowed Gen. Petraeus and businessman Roger Hertog with awards during a swanky affair at the Pierre. The organization's president and chief executive, Louise Mirrer, praised Gen. Petraeus's "groundbreaking work in Iraq" and Mr. Hertog's "dedication to the power of ideas."
Henry Kissinger and General David Petraeus Don Pollard
Pam Schafler, Roger Hertog and Louise Mirrer Don Pollard. Don Pollard. Don Pollard
The Historical Society maintains a Manhattan museum and library, founded in 1804, devoted to work involving New York's city and state history. Attendees at the event included former New York Gov.George Pataki, former Republican National Committee Chairman Ken Mehlman, writer Niall Ferguson and a handful of hedge-fund managers.
Gen. Petraeus said the attendees included "masters of the universe, my goodness." The gala raised more than $3 million for the society.
Since his resignation from the CIA, after admitting to having an extramarital affair with his biographer, Gen. Petraeus has been lecturing at the City University of New York and working at a private-equity firm. Antiwar activists protested Gen. Petraeus's award on social media and outside the Pierre.
In wide-ranging remarks, he joked about "a midlevel executive working at a financial firm, frustrated at getting passed over for promotion" who visits a brain-transplant center where "an ounce of a television reporter's brains" goes for cheap, and an ounce of a four-star general's brain is expensive.
"Do you have any idea how many generals it takes to get an ounce of brains?" goes the punch line.
"That's just a joke, I think," Gen. Petraeus said afterward. "When you reach this point in life, you're only as good as the material they give you."
Secretary of the Treasury Tim Geithner moves into Private Equity
Tim Geithner left the treasury with two goals, the first being to write his own account of the financial crisis and the second to make some of his own money. His book is done and due to be published next year, so that is goal one. Last Saturday Mr. Geithner announced he is joining Warburg Pincus so that would be goal two. Mr Geithner will be joining the ranks of other public officials such as David Petraeus KKR's Chair of the Global Institute and Kenneth Mehlman who became their Head of Global Public Affairs.
Mr. Geithner's wealthier friends have said that he, "needs to make some money". Spending most of his career in government finance, in the treasury he made around $200,000 a year plus $411,000 a year and a $436,686 separation payment from the Federal bank of new york. This may seem like a lot of money but compared to the corporate salaries of his friends in the private sector it is not much. Warburg Pincus trusts that they will get more than just high level contacts and insider knowledge of the treasury from Geithner. They know that he has proved himself as investment savvy. While working at the treasury Geithner dealt with hundreds of billions of dollars in investments for financial institutions to prop up the economy. “The roots of Warburg Pincus go back 45 years and we are really much more a global growth-oriented entrepreneur-centric investor,” says Chip Kaye, co-chief executive. “We have been active in starting and building businesses in energy, technology and healthcare; and we were very early investors in China and India. I think that’s one of the things that most attracted Tim – a broader investing context.”
“He supervised the management of what was, for a time, the largest investment portfolio in the world,” says Mr Millstein. “And though the public will never give him credit for it, he did it very successfully.”
KKR to invest $100 million into wireless infrastructure
KKR is making its 11th infrastructure investment. This time they are focussing on wireless infrastructure in rural America. KKR will be a minority investor in its three different communication companies. 1. PEG Bandwidth is a company that builds and operates backhaul networks. Their focus is on connecting wireless communication towers to the data and fiber backbone networks on the ground. 2. AP Wireless buys cell sites both on the ground and on rooftops (domestic and international.) 3. AP Towers develop wireless communication towers and purchase already existing towers. With the explosion of smart devices there has been a dramatic increase in demand for data. This demand is driving investments into wireless infrastructure. The current infrastructural grid is drastically outdated and in a large part of the country still consists of copper cable, which is unable to handle the burden of big data. Raj Agrawal, KKR's Head of North American Infrastructure said, "The need for wireless infrastructure will continue to be driven by increases in wireless data usage that is overwhelming existing network capacity... We are excited about the opportunity to partner with Associated Partners to grow this premier set of businesses with critical telecom infrastructure assets." KKR appears to be betting on factions of the economy that are driven by technical revolutions. In the last year they have also invested into natural gas. With the development of shale natural gas, the amount of natural gas available has skyrocketed. "As the shale revolution is driving the growth of natural gas pipelines to transport molecules, the advent of the smart phone is driving a similar wireless explosion to transmit electrons. Wireless communication networks are an essential component of the nation's infrastructure," said Scott Bruce, Managing Director of Associated Partners, L.P. "We are excited to have KKR partner with us as we expand our businesses."
About KKR Founded in 1976 KKR is led by Henry R. Kravis and George Roberts. KKR is a leading investment firm with $90.2 billion under management as of September 30, 2013. With offices around the world, and notable global voices such as David Petraeus, KKR manages assets through a variety of investment funds and accounts covering multiple asset classes. KKR seeks to create value by bringing operational expertise to its portfolio companies and through active oversight and monitoring of its investments.
http://assetsandmanagement.blogspot.com/2013/10/kkr-to-invest-100-million-in-wireless.html
If we ever get over this political crisis, is there growth ahead?
So far the market has not really been phased by the government shutdown. We have seen a small downturn this week but no large change. However if the U.S. does does not come to a consensus over the Affordable HealthCare Act and we don't raise the Debt Ceiling it could have catastrophic consequences on the economy. Most investors seem to be complacent saying that the shutdown/debt ceiling is not a reason to sell stocks. However, if the U.S. does reach what many think to be a 0% chance scenario where we are unable to pay the interest on our loans it is predicted that the S&P 500 would crash to 850, about a 50% drop. However if we do make it past this Political fiasco the economy may still have juice left to climb. I have written a few times before about KKR, as experts in the market they often provide useful insights. Alex Nevab KKR's co-head of Americas private equity said, "We actually see the economy recovering and has further to go through 2016 or 2017." KKR believes that if we do get past this debt ceiling crisis that the market was not at a low point or a high point and is showing a good environment for growth. Other notable leaders in KKR include former RNC chairman Kenneth Mehlman and General David Petraeus.
http://assetsandmanagement.blogspot.com/2013/10/if-we-ever-get-over-this-political.html
KKR to invest in China
Supported by their global institute run by David Petraeus and Ken Mehlman KKR has been expanding into Asian markets. In China specifically they have recently agreed to buy a 10% stake in Qingdao Haier Co Ltd. a large appliance maker. This stake in QHC is KKR's biggest investment in China to date and is their third asian deal with in a week. The investment is speculated to be around $550 million, a small portion of their $6 billion Asian investment fund. KKR expects to see a large growth in the appliance market in China, at lease 1/5th in the next two years and they are not the only ones. Two months ago Whirlpool Corp, the worlds larges appliance maker also invested a similar sum into China.