KKR & Co. Inc. (NYSE:KKR) has secured a deal to acquire Swedish consumer health firm Karo Healthcare.
The transaction is subject to customary regulatory conditions and approvals and is expected to close in the coming months, per a statement.
"We engaged the full capabilities of our firm to deliver this transaction during a period of market disruption and we look forward to supporting Karo's growth as a value-enhancing strategic partner," said Hans Arstad, Managing Director at KKR.
The transaction, expected to be valued at approximately 2.65 billion euros ($2.924 billion) including debt, would see KKR beat out rival bidder PAI Partners to secure the company behind popular over-the-counter brands like E45 and Lamisil, Financial Times reports.
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Karo Healthcare, headquartered in Stockholm, has expanded significantly under the ownership of EQT, which took the firm private in 2022 at a valuation of 1.4 billion euros.
EQT initially took a majority stake in Karo back in 2019 when the business was still listed, Financial Times adds.
The acquisition underscores KKR's confidence in healthcare-focused investments even as overall merger activity has slowed due to uncertain interest rate policy and fluctuating debt markets.
The buyout is poised to provide a strong return for EQT, following a series of brand acquisitions Karo made in recent years.
Under EQT's stewardship, Karo spent £200 million in 2021 to acquire the E45 skincare line from Reckitt Benckiser Group Plc (OTC:RBGLY), and in 2023 it purchased Lamisil from Haleon Plc (NYSE:HLN) for £235 million. The company currently markets over 100 products across 90 countries, with a portfolio that includes Nutravita, Alpha Foods, and Remescar. Karo employs about 400 people globally.
This deal would further KKR's extensive footprint in the European healthcare sector.
The firm, which manages $668 billion in assets, has recently invested in U.K.-based Clinisupplies and Swiss peptide manufacturer Biosynth, among others.
According to Benzinga Pro, KKR stock has lost over 5% in the past year. Investors can gain exposure to the stock via FM Focus Equity ETF (NYSE:FMCX).
Price Action: KKR shares closed higher by 16.90% to $110.46 on Wednesday.
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