Private equity giant KKR & Co. GP LLC is paying a US$250-million penalty to resolve allegations that it repeatedly failed to comply with pre-merger review requirements.
The U.S. Department of Justice (DoJ) reached a proposed settlement with KKR in connection with allegations that the firm violated requirements to submit pre-merger filings to the DoJ’s antitrust division and the U.S. Federal Trade Commission (FTC) for at least 16 proposed M&A deals.
Specifically, the complaint alleged that in 2021 and 2022, KKR failed to comply with the filing requirements by omitting required documents for 10 deals, failed to file anything on two transactions, and altered documents in several others.
The proposed penalty, which was filed Wednesday in the U.S. district court for the Southern District of New York (SDNY), will go out for a 60-day public comment period before the court rules on whether to approve the settlement.
“The [antitrust legislation’s] requirements protect competition by giving the Justice department an opportunity to investigate potentially unlawful transactions,” said associate attorney general, Stanley Woodward Jr., in a release. “Companies that disregard their legal obligations will face serious consequences.”
In a statement, a spokesperson for KKR said, “We strongly disagree with the antitrust division’s characterization of this matter. We believe that our firm acted in good faith at all times under our prior filing process, and it was consistent with industry practice. However, we determined that ongoing litigation would be a significant distraction for our organization, and we are pleased to put this behind us.”
The firm also said that the proposed penalty, “will have no financial impact on the firm, our funds, or any of our investors and will be fully reimbursed by outside law firms.”