FS KKR Capital Corp. (FSK): History, Ownership, Mission, How It Works & Makes Money

Ever wondered how business development companies operate and generate revenue? FS KKR Capital Corp. (FSK), a leading publicly traded business development company, focuses on providing tailored credit solutions to private middle market U.S. companies. With a portfolio fair value of $13.5 billion and a weighted average yield on accruing debt investments of 11% as of December 31, 2024, how does FS KKR Capital Corp. (FSK) navigate the financial landscape to deliver returns to its investors? Keep reading to explore its history, ownership structure, mission, and the mechanics of its operations and revenue generation.

FS KKR Capital Corp. (FSK) History

FS KKR Capital Corp.’s Founding Timeline

Year established

FS KKR Capital Corp. was established in 2007.

Original location

The company is headquartered in Philadelphia, PA.

Founding team members

While specific founding team members are not explicitly detailed in the provided context, the company's formation is linked to FS Investments and KKR, indicating involvement from key individuals within these firms.

Initial capital/funding

Information regarding the initial capital and funding is not available in the search results.

FS KKR Capital Corp.’s Evolution Milestones

FS KKR Capital Corp.’s Transformative Moments

• Strategic Partnerships: Collaborations with established firms like KKR have provided access to expertise and deal flow, enhancing investment opportunities.
• Mergers and Acquisitions: The merger of FS Investment Corporation and Corporate Capital Trust was a transformative moment, creating a larger entity with greater resources.
• Adaptation to Market Conditions: FSK has demonstrated the ability to navigate changing economic landscapes, adjusting its investment strategies to capitalize on emerging opportunities while mitigating risks.
• Focus on Middle Market: Specializing in providing financing solutions to middle market companies has allowed FSK to carve out a niche and establish itself as a key player in this segment.

To gain deeper insights into the investor landscape of FS KKR Capital Corp., explore Exploring FS KKR Capital Corp. (FSK) Investor Profile: Who’s Buying and Why?.

FS KKR Capital Corp. (FSK) Ownership Structure

FS KKR Capital Corp. operates with a diverse ownership structure, encompassing a mix of institutional, retail, and insider stakeholders.

FS KKR Capital Corp.'s Current Status

FS KKR Capital Corp. is a publicly traded company, meaning its shares are available for purchase on the stock market. As a Business Development Company (BDC), it is subject to specific regulations and reporting requirements.

FS KKR Capital Corp.'s Ownership Breakdown

Understanding the ownership composition of FS KKR Capital Corp. provides insights into the distribution of control and potential influences on company strategy. While precise, real-time ownership percentages fluctuate, the following table represents a general overview based on the most recently available data for the fiscal year 2024.

FS KKR Capital Corp.'s Leadership

The leadership team plays a crucial role in guiding FS KKR Capital Corp.'s strategic direction and operational execution. As of April 2025, key figures include:

• Michael J. Forman: Chairman of the Board and Chief Executive Officer
• Daniel Pietrzak: Chief Investment Officer and Co-President
• Brian Gerson: Co-President

These individuals, along with other members of the executive team, are responsible for overseeing the company's investment activities, managing its portfolio, and ensuring compliance with regulatory requirements.

For insights into the company's financial well-being, read Breaking Down FS KKR Capital Corp. (FSK) Financial Health: Key Insights for Investors.

FS KKR Capital Corp. (FSK) Mission and Values

FS KKR Capital Corp. aims to generate current income and, to a lesser extent, long-term capital appreciation through investments in privately held middle-market companies. The company emphasizes a commitment to integrity, transparency, and accountability in its operations.

FS KKR Capital Corp.'s Core Purpose

Official mission statement

FS KKR Capital Corp. does not have a single, universally publicized official mission statement. However, information regarding the company's objectives and investment strategies can be found in their filings with the Securities and Exchange Commission (SEC) and investor relations materials. These documents outline the company's commitment to:

• Generating current income.
• Achieving long-term capital appreciation.
• Investing primarily in privately-held middle-market companies.

Vision statement

While FS KKR Capital Corp. doesn't have a specific, declared vision statement, its corporate actions and stated objectives suggest a vision focused on:

• Being a leading provider of capital to middle-market companies.
• Delivering attractive risk-adjusted returns to its shareholders.
• Maintaining a disciplined and rigorous investment approach.

Company slogan/tagline

FS KKR Capital Corp. does not have a widely recognized public slogan or tagline. The company's communication typically focuses on its investment strategies, financial performance, and portfolio composition. For additional details, explore Mission Statement, Vision, & Core Values of FS KKR Capital Corp. (FSK).

FS KKR Capital Corp. (FSK) How It Works

FS KKR Capital Corp. operates as a specialty finance company focused on providing debt and equity capital to middle-market companies, aiming to generate current income and capital appreciation.

FS KKR Capital Corp.'s Product/Service Portfolio

FS KKR Capital Corp.'s Operational Framework

FS KKR Capital Corp. generates revenue primarily through:

• Interest Income: Collecting interest on its portfolio of debt investments, mainly senior secured and subordinated loans.
• Dividend Income: Receiving dividends from its preferred and common equity investments.
• Capital Gains: Realizing gains from the sale of equity investments and debt securities.

Key operational aspects include:

• Origination: Sourcing investment opportunities through its network and relationships with private equity sponsors, investment banks, and management teams.
• Underwriting: Conducting due diligence and structuring investments to manage risk and maximize returns.
• Portfolio Management: Actively monitoring investments, providing support to portfolio companies, and managing risk exposures.
• Funding: Raising capital through debt and equity offerings to fund investments and manage its capital structure. As of December 31, 2024, FS KKR Capital Corp. had approximately $11.9 billion in principal debt outstanding and $1.6 billion in available liquidity.

FS KKR Capital Corp. had a total investment portfolio with a fair value of approximately $15.4 billion as of December 31, 2024. The weighted average yield on debt investments was 12.2%.

FS KKR Capital Corp.'s Strategic Advantages

• Scale and Resources: Benefit from the extensive platform and resources of FS Investments and KKR, providing access to deal flow, expertise, and capital.
• Experienced Management Team: Leverage the expertise of its management team in credit investing and private equity.
• Disciplined Investment Approach: Employ a rigorous underwriting process and focus on downside protection.
• Flexible Capital Base: Utilize a flexible capital base to invest across the capital structure and pursue diverse investment opportunities.

To learn more, check out: Exploring FS KKR Capital Corp. (FSK) Investor Profile: Who’s Buying and Why?

FS KKR Capital Corp. (FSK) How It Makes Money

FS KKR Capital Corp. primarily generates income through investments in privately held middle-market companies, mainly through debt securities.

FS KKR Capital Corp.'s Revenue Breakdown

FS KKR Capital Corp.'s Business Economics

• Investment Strategy: FS KKR Capital Corp. focuses on investing in senior secured debt, second lien debt, and, to a lesser extent, subordinated debt and equity investments. This strategy aims to provide a blend of current income and capital appreciation.
• Target Companies: The firm targets middle-market companies with annual revenues between $10 million and $2.5 billion. These companies typically require capital for growth, acquisitions, or recapitalizations.
• Pricing and Yield: The yield on investments is determined by prevailing interest rates, credit risk of the borrower, and the overall market demand for middle-market debt. The company seeks to generate attractive risk-adjusted returns.
• Economic Factors: The company's performance is influenced by broader economic conditions, including interest rate movements, credit spreads, and the overall health of the middle-market sector.
• Mission Statement, Vision, & Core Values of FS KKR Capital Corp. (FSK).

FS KKR Capital Corp.'s Financial Performance

• Net Investment Income (NII): A key metric indicating the company's profitability, NII represents the income generated from investments less operating expenses. For example, in 2023, FS KKR Capital Corp. reported NII of $2.83 per share.
• Asset Quality: Monitored through metrics like the percentage of non-accrual loans. As of Q4 2023, non-accruals were at 3.1% of the portfolio at fair value.
• Leverage: The company uses leverage to enhance returns, but excessive leverage can increase risk. FS KKR Capital Corp. aims to maintain a debt-to-equity ratio within its target range.
• Dividend Policy: FS KKR Capital Corp. distributes a significant portion of its earnings to shareholders through dividends. The dividend yield is an important factor for investors. The company declared total distributions of $2.92 per share for the year 2023.
• Operating Expenses: Managed through an advisory agreement with FS/KKR Advisor, LLC, which covers management fees and incentive fees based on performance.

FS KKR Capital Corp. (FSK) Market Position & Future Outlook

FS KKR Capital Corp. is strategically positioned to navigate the evolving market landscape, focusing on investments in upper middle market companies. Their future outlook involves capitalizing on direct origination platforms and leveraging their expertise in credit markets to deliver consistent returns. More information about their goals can be found at Mission Statement, Vision, & Core Values of FS KKR Capital Corp. (FSK).

Competitive Landscape

Note: Market share percentages are estimates based on publicly available information regarding portfolio sizes and total assets under management in the Business Development Company (BDC) sector as of the 2024 fiscal year. Actual figures may vary.

Opportunities & Challenges

Industry Position

FS KKR Capital Corp. holds a significant position within the BDC industry, characterized by:

• Focus on Upper Middle Market: Targeting companies with established business models and strong management teams.
• Direct Origination Capabilities: Sourcing a substantial portion of its investments through its direct origination platform.
• Leveraging KKR Platform: Benefiting from KKR's global resources, operational expertise, and extensive network.
• Active Portfolio Management: Engaging actively with portfolio companies to drive operational improvements and enhance value.

The company aims to deliver attractive risk-adjusted returns to its investors through a combination of current income and capital appreciation.