Kohlberg Kravis Roberts & Co co-founders Henry Kravis and George Roberts were each paid about $22 million last year in fee and other income, and together own about a quarter of the storied buyout firm, according to a regulatory filing.
KKR, behind huge acquisitions such as RJR Nabisco and TXU, is moving closer to gaining its long-sought New York Stock Exchange listing. On Tuesday it updated its filing with the U.S. Securities and Exchange Commission with details of senior executive ownership and pay.
Private equity firms have typically kept details such as compensation closely guarded, but such financial disclosures are becoming more common as a number go public.
Kravis and Roberts are each taking a yearly salary of $250,000, according to the filing. They were also each awarded a $70 million noncash amount, which represents how KKR accounts for the difference in value between what they owned before KKR became a public company and how it is valued after becoming publicly traded.
The distribution of $22 million was mostly made up of their share of KKR's fee income, generated from businesses including KKR's capital markets, private equity funds and KKR asset management units.
A small part is carried interest -- the percentage of profit that private equity executives take when their funds perform well.
The listing process contrasts with that of rival private equity giant Blackstone Group , which went public in 2007. The payout to Blackstone CEO Stephen Schwarzman was up to $677.2 million. Schwarzman, who drew a salary of $350,000 last year, currently owns about 23 percent of Blackstone.
Schwarzman was ranked in March as number 171 on Forbes magazine's ranking of the world's top billionaires with $4.7 billion, a hair ahead of Kravis at number 201 with $4.2 billion.
(For a Breakingviews column on KKR, http://link.reuters.com/nyk95m)
Another private equity firm shortly to be listed on the NYSE, Apollo Management LP , also recently disclosed details of compensation. Founder Leon Black received $787,391 in compensation in 2009, which was made up of $100,000 salary.
Private equity executives typically take the bulk of their pay in carried interest and income from fees rather than salary.
KKR is going public via a complex route that involved buying its Amsterdam-quoted fund, KKR Private Equity Investors, and becoming a Euronext-listed company. Under that deal, KKR owns 70 percent of the new company.
Kravis and Roberts, who co-founded the firm in 1976 with Jerome Kohlberg Jr., each own 87 million shares in the company, according to the filing, which equates to just under 13 percent each of the total 683 million shares. Kohlberg resigned in 1987 and later started his own buyout firm.
Based on the price of KKR's shares on Euronext at Monday's close, their stakes are worth around $809 million each, or $1.6 billion total. Their percentage ownership in the company, not previously disclosed, will be about the same before and after its NYSE listing.
Kravis' and Roberts' ownership stake has gradually decreased as the company has grown. The company has assets under management of about $55 billion and employs about 600 staff worldwide. Those employees own a significant portion of the company.
KKR as a whole is valued at around $6.4 billion, based on Monday's close in Amsterdam.
KKR filed with the SEC in March to list on the NYSE and trade under the symbol KKR. It has said the listing would allow it to have a more permanent capital base, use stock to retain and attract staff, and have a currency to use in making acquisitions.
It has made several amendments to the original filing.
The SEC needs to declare the listing registration effective before KKR can decide when the shares will start trading.
(Reporting by Megan Davies; Editing by John Wallace, Matthew Lewis and Steve Orlofsky)