KKR & Co. (NYSE:KKR) is set to pay a $250 million civil penalty after the private equity firm allegedly violated the Hart-Cottrell-Rodino Act by withholding and altering documents and failing to make required filings.
The HSR Act requires M&A parties involved in deals above a certain size to file premerger notifications with the DOJ’s Antitrust Division and the FTC. The filings help the agencies enforce Section 7 of the Clayton Act, which prohibits transactions that may substantially harm competition.
U.S. Department of Justice’s complaint alleges that KKR failed to submit complete and accurate premerger filings for at least 16 transactions between 2021 and 2022.
The firm, which has made more than 100 required premerger filings since 2021, allegedly altered documents in HSR filings for at least eight deals, failed to file at least two deals, and systematically omitted required documents from filings for at least 10 deals.
"This historic $250 million civil penalty – more than 20 times any prior HSR penalty obtained by the DOJ – sends a powerful message: the Department is committed to vigorous enforcement of the Act. The Act’s requirements protect competition by giving the Justice Department an opportunity to investigate potentially unlawful transactions. Companies that disregard their legal obligations will face serious consequences," said Associate Attorney General Stanley E. Woodward Jr.
The HSR Act allows for civil penalties of more than $50,000 per day for each violation. If approved, the proposed $250 million penalty would be the largest civil penalty ever imposed for violations of the HSR Act.
KKR, based in New York, has more than $744 billion in assets under management. The firm operates across three businesses: asset management, insurance and strategic holdings.
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