KKR closed on its first private credit continuation vehicle with more than $460 million in total commitments, according to market sources.
Allianz Global Investors is the lead buyer of the vehicle, sources said. The vehicle contains the assets of KKR Lending Partners III, a $1.5 billion direct lending fund that completed fundraising in 2017.
The transaction provided existing investors with the flexibility to either receive liquidity by selling their interests or maintain their investment on substantially the same terms through a rollover into the new vehicle.
Evercore served as financial advisor and Debevoise served as legal counsel to KKR.
KKR Lending Partners III generated an 11.0% net IRR and a 1.7x MOIC as of June 30, 2026, according to a KKR 10-Q filing.
AllianzGI is also the lead investor on Blackstone's $1 billion private credit continuation vehicle, and the firm co-led Crescent Capital's $3.2 billion private credit continuation vehicle earlier this year.
Allianz has invested in private credit since 2007, while AllianzGI launched its first dedicated private credit secondaries fund in 2022.
A KKR spokesperson said the transaction represented an expansion of the firm's relationship with AllianzGI.
"We are pleased to have drawn on our comprehensive private credit secondaries experience to lead and structure this landmark transaction with KKR," said Alexander Li, Senior Portfolio Manager at AllianzGI Global Private Credit.
Continuation vehicles are an increasingly popular way for private credit GPs to return capital to existing LPs while retaining underlying assets, and the market has become much hotter in recent years.
Data from Evercore earlier this year showed that deal volume for credit secondaries in H1 2026 alone surpassed 2025's full-year volume of $20 billion, with the majority of this volume coming from continuation vehicles.
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This article originally appeared on PitchBook News
