KKR New York listing scheduled for Thursday, July 15 & subsequent rights offering. Not an IPO

NOT AN IPO

. Re-listing from Europe to the US and a merger between the European entity and KKR Holdings . After the NYSE listing KKR plans a rights offering of $500mm (8% dilution) primarily, apparently, for the purpose of funding general partner capital commitments to KKR’s funds DOESN’T LOOK CHEAP compared to Blackstone (BX)

VALUATION METHOD

Ratio of Assets Under Management (AUM) to market capitalization, higher is better

Ratio of Market Cap to AUM, lower is better

COMPARE	Mrkt			AssetsUnder	AUM*/	Mrkt Cap/
& CONTRAST	Cap (mm)			Mgt $mm	Mrkt Cap	AUM*
KKR -- pre rights offering	$6,448			$54,700	8.5	12%
KKR - post rts offering at $9.44	$6,948			$54,700	7.9	13%
The Blackstone Group (BX)	$11,170			$104,500	9.4	11%
Och-Ziff Capital (OZM)	$4,530			$25,300	5.6	18%
			* = Assets Under Mgt		higher is	lower is
					better	better

PRE-RIGHTS OFFERING

KKR Guernsey holds a 30% economic interest in the Combined Business through Group Holdings, and KKR principals hold a 70% economic interest in the Combined Business through KKR Holdings.

POST-RIGHTS OFFERING

of $500mm: 53mm common units at $9.44 each

New common unitholders will hold 7.2% of fully diluted common units Former KKR Guernsey unitholders will hold 27.8% of fully diluted common units Principals will hold the remaining 65.0% through KKR Holdings.

USE OF PROCEEDS

To fund the continued growth of the existing asset management business "including through funding our general partner capital commitments to our funds"

Note: this is the real reason for the $500mm rights offering

DISTRIBUTION POLICY

Intends to make quarterly cash distributions in amounts that in the aggregate are expected to constitute substantially all of the cash earnings of the asset management business in excess of amounts determined by the Managing Partner to be necessary or appropriate to provide for the conduct of the business