Exhibit (c)(16)
Project Copal Goldman, Sachs & Co. November 2013 |
Comparison of KFN and KKR Investor Base Investors by Style Over Time KFN Style Evolution KKR Style Evolution 12% 13% 13% 12% 11% 14% 13% 14% 24% 25% 22% 22% 22% 21% 22% 21% 17% 14% 12% 15% 19% 21% 19% 19% 11% 13% 15% 17% 14% 10% 9% 9% 30% 29% 30% 28% 28% 27% 27% 27% 4% 3% 5% 4% 4% 5% 5% 5% 2% 2% 2% 1% 1% 2% 2% 2% 2% 2% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Q4 '11 Q1 '12 Q2 '12 Q3 '12 Q4 '12 Q1 '13 Q2 '13 Q3 '13 Income Growth Hedge Fund Value GARP Other Income Growth Hedge Fund Value GARP Other Sector Specific Index |
Active Share Ownership and Overlap KFN Top 25 Active Institutional Holders KKR Top 25 Active Institutional Holders KFN KKR Fund Style %OS %OS Omega Advisors, Inc. Hedge Fund 7.35 Thornburg Investment Income Builder Fund Income 6.12 Fidelity Equity-Income Fund Income 2.73 1.16 Fidelity Mid-Cap Stock Fund Growth 2.42 0.59 Fidelity VIP Equity-Income Portfolio Income 1.83 0.78 Oppenheimer Equity Income Fund Value 1.82 Cobalt Capital Management, Inc. Hedge Fund 1.49 Lakewood Capital Management, LP Hedge Fund 1.14 Fidelity Growth & Income Portfolio Value 1.13 0.49 Fidelity Advisor Diversified Stock Fund Growth 1.10 0.17 Fidelity New Millennium Fund Growth 0.71 0.15 Fidelity Advisor Equity Income Fund Value 0.71 0.30 Legg Mason Capital Management Special Investment Trust GARP 0.67 TIAA-CREF Mid Cap Value Fund Income 0.57 Renaissance Technologies Corp. Hedge Fund 0.50 Royce Low-Priced Stock Fund GARP 0.47 DWS Small Cap Value Fund Growth 0.37 JNL/Eagle SmallCap Equity Fund GARP 0.33 Phillips, Hager & North U.S. Multi-Style All-Cap Equity Fund Other 0.33 Hennessy Small Cap Financial Fund Sector Specific 0.30 Fidelity Large Cap Stock Fund Growth 0.30 0.05 Centurion Investment Group L.P. Hedge Fund 0.24 Fidelity Advisor Series Equity-Income Fund Other 0.23 0.07 IronBridge SMID Cap Fund Income 0.20 ING Mid Cap Value Fund Other 0.20 Top 25 Active Institutional Holders 33.24 3.76 Fund Style %OS %OS Ivy Asset Strategy Fund GARP 4.56 GMT Capital Corp. Hedge Fund 1.64 Ariel Fund GARP 1.47 Chilton Investment Company, LLC Hedge Fund 1.35 Fidelity Equity-Income Fund Income 1.16 2.73 Serengeti Asset Management LP Hedge Fund 0.99 Renaissance Technologies Corp. Hedge Fund 0.94 0.50 JOHCM Global Select Fund Growth 0.82 Ariel Appreciation Fund GARP 0.79 Fidelity VIP Equity-Income Portfolio Income 0.78 1.83 Fidelity Value Fund GARP 0.72 Fidelity Magellan Fund Growth 0.67 JNL/Red Rocks Listed Private Equity Fund Growth 0.62 Matthew 25 Fund, Inc. Value 0.59 Fidelity Mid-Cap Stock Fund Growth 0.59 2.42 Waddell & Reed Advisors Asset Strategy Fund GARP 0.54 American Century Heritage Fund Growth 0.52 Royce Total Return Fund Income 0.50 Fidelity Equity Dividend Income Fund Value 0.49 Fidelity Growth & Income Portfolio Value 0.49 1.13 Putnam Fund for Growth and Income Fund Income 0.46 American Beacon Large Cap Value Fund Income 0.45 Principal Equity Income Fund Growth 0.43 JNL/Ivy Asset Strategy Fund Growth 0.37 DWS Vermogensbildungsfonds I Income 0.37 Top 25 Active Institutional Holders 22.30 8.61 |
Investor Analysis by Style Income investors represent 54% ownership in KFN and approximately $788mm invested Among the top 8 funds with income and yield investment strategies, representing 15% O/S in KFN, we estimate $24-54mm in likely selling post-close of the funds’ $316.15mm invested Income / Value Growth / GARP Hedge Fund Growth and GARP investors represent 26% ownership in KFN and approximately $512mm invested We expect all Growth and GARP investors to likely hold based on the greater pro forma growth profile than pre-deal KFN 5% OS and $95mm invested by Growth and GARP funds in KFN overlap with KKR Funds with positions in KFN and KKR may consolidate their positions and sell an estimated $10-21mm or 0.1% O/S Reaction of Hedge Funds will not likely be dictated by technical but rather by how they perceive value creation in the deal |
Income Investor Analysis Fund % O/S Observations Possible Reaction to Transaction Holdings Likely to Sell % Holdings Likely to Sell Thornburg Investment Income Builder 6.12 Top holdings dividend yields range from 2.1-8.7% with an average of 5.0% Hold $12-24mm 10 - 20% Fidelity Equity Income Fund 2.73 Top holdings dividend yields range from 2.1-3.5% with an average of 2.9% Hold $5-11m 10 - 20% Fidelity VIP Equity Income Fund 1.83 Top holdings dividend yields range from 2.1-3.5% with an average of 2.9% Hold $4-7mm 10 - 20% Oppenheimer Equity Income Fund 1.82 Top holdings dividend yields range from 0.1-3.5% with an average of 2.2% Hold $0-4mm 0 - 10% Fidelity Growth & Income Portfolio 1.13 Top holdings dividend yields range from 0.1-3.5% with an average of 2.6% Hold $2-4mm 10 - 20% Fidelity Advisor Equity Income Fund 0.71 Top holdings dividend yields range from 2.1-3.5% with an average of 2.9% Hold $1-3mm 10 - 20% TIAA-CREF Mid Cap Value Fund 0.57 Top holdings dividend yields range from 0.8-3.2% with an average of 1.6% Hold $0-1mm 0 - 10% IronBridge SMID Cap Fund 0.20 Top holdings dividend yields range from 0.3-4.4% with an average of 2.0% Hold $0-0.4mm 0 - 10% Total 15.11% $24-54mm 6.25 – 16.25% |