Gentlemen at the gate: Inside a new KKR

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A mixed bag KKR’s first decade (the firm launched its India office in 2006 but gained momentum really after Nayar’s arrival in 2009) in India is something of a mixed bag. Nayar led KKR through two phases of private equity investing. The KKR playbook globally has always been big buyouts, but the India market was different and it began slowly by acquiring small stakes in companies such as Cafe Coffee Day, Bharti Infratel, and Dalmia Cements, among others.

The firm hit its stride with deals in 2013 in Alliance Tyres Group (where it bought more than 90% equity stake) and Gland Pharma (in which it acquired a 33% stake). Both generated blockbuster returns for KKR in India. That was also the year that KKR, under Nayar, decided that it was better off adopting the global KKR playbook and KKR started pursuing larger buyout deals.

The Indian market had also matured by then to throw up opportunities for large-sized control transactions (called so as the investor gains control of the firm). The philosophy then was to “control your own destiny"—meaning, unlike a minority investment, the firm won’t be at the mercy of other investors in a buyout and can control its path to exit, and therefore returns. Typically, control deals also help funds like KKR deploy large sums.

This strategy led KKR to acquire majority stakes in several companies, such as Radiant Life Care in 2017. The latter merged with Max Healthcare in 2020, which KKR exited last year to blockbuster returns. But as KKR started expanding its ambition in India, it suffered a reversal.