Private investment major KKR has agreed to acquire Gen II Fund Services, a private capital fund administrator backed by Hg and General Atlantic, in a transaction valuing the business at $5.1bn, according to Private Equity Wire.
KKR will make the investment through its Core Private Equity strategy and acquire Gen II from Hg, General Atlantic and other minority shareholders, according to Private Equity Wire.
Transaction structure and timing
The deal is subject to customary closing conditions and regulatory approvals, and it is expected to be completed in 2027, according to Private Equity Wire.
Leadership continuity and company background
Gen II chief executive and co-founder Steven Millner will continue to lead the business alongside its existing management team.
Gen II was founded in 2009 by Steven Millner, Steven Alecia and Norman Leben.
Hg and General Atlantic invested in the business in 2020, after which Gen II expanded across the US and Europe, diversified its services and completed four acquisitions.
Gen II’s scale and service offering
Gen II provides administration services to more than 275 investment managers overseeing more than $2tn of assets.
Gen II’s offering includes tax, compliance, treasury and technology-enabled services for private capital managers and investors.
Hg and General Atlantic said Gen II has quadrupled both revenue and EBITDA since their investment, driven by organic growth and acquisitions.
Hg and General Atlantic also supported the development of Gen II’s technology offering, including its GenVū client portal, alongside automation and AI applications for areas such as client onboarding and bank reconciliations.
KKR’s stated plans for Gen II
KKR said the deal gives it exposure to infrastructure supporting private markets as asset managers contend with increasingly complex fund structures, investor reporting requirements and regulatory demands.
KKR said it plans to support Gen II’s expansion in the US and internationally while broadening its services across asset classes.
KKR also said it intends to invest in Gen II’s technology platform, including artificial intelligence-enabled capabilities, and introduce a broad employee ownership programme.
KKR said its interest in Gen II reflects the firm’s broader focus on financial services businesses and its view that fund administration stands to benefit from the continued expansion of private markets.
For Hg and General Atlantic, the transaction represents an exit after six years of backing the company and helping it transition from a founder-led business into a larger global platform.
