KKR’s non-traded business development company KKR FS Income Trust Select has agreed to meet all investor withdrawal requests after quarterly repurchase demands narrowly exceeded its 5% redemption limit, according to a report any Bloomberg.
The private credit vehicle, known as K-FITS, received requests to repurchase 5.06% of its outstanding shares for the quarter ended September 29, according to a regulatory filing. With net assets of approximately $996m, the fund will make a small exception to its 5% cap and fulfil the requests in full.
KKR said the excess was modest and that the fund had sufficient liquidity to accommodate all withdrawals.
The move comes as private credit managers continue to navigate elevated redemption pressure across the non-traded BDC market. Concerns over lending standards and exposure to software companies vulnerable to disruption from artificial intelligence have prompted investors to seek greater liquidity from some vehicles.
Redemption demand across the broader direct lending market, valued at around $1.8tn, eased at several large managers during the latest quarter. However, K-FITS saw requests increase from 3.43% in the previous quarter.
KKR’s separate KKR FS Income Trust, or K-FIT, faced considerably lower redemption pressure. Investors sought to withdraw 1.53% of outstanding shares during the latest period, down from 1.65% previously, and the fund will also satisfy all requests.
Although K-FIT and K-FITS pursue similar investment strategies, they are managed and distributed separately.
K-FIT had assets of approximately $1.7bn and has generated an annualised net return of 12.67% since its launch in March 2023. K-FITS, which began operating in February 2024, has delivered an annualised net return of 8.64%.
