It was apparently too much for Jerry. With things over-frothy in the buyout market, mega deals proliferating and purchase price multiple escalating, the co-founder of the largest buyout shop in the world announced he was leaving to start his own smaller practice.
In moving on, Jerry said in an interview he would look for more modestly sized opportunities. ”I won’t restrict myself to small transactions,” the exiting founder reported, “but I’ll stick with deals where reason still prevails.”
One of his remaining two partners ventured an explanation for their friend’s departure: “Jerry may have felt that the deals were getting too big.”
Recent news? Guess again. “Jerry” was Jerome Kohlberg, Jr., who in June 1987 left KKR to form Kohlberg & Company, one of the pre-eminent middle market buyout shops in the US. The firm raised seven funds and $5.3 billion of committed capital to create 64 platform companies and 133 add-ons, with an aggregate transaction value of $9 billion.
Our venture down memory lane was prompted by last Monday’s WSJ op-ed by Andy Kessler. The investor/author pronounced private equity “done,” stating it’s “glory days are over.”