KKR has closed the reported $1.2 billion acquisition of Mills Fleet Farm, a previously family-owned retailer of rural consumer goods. Founded in 1955, the business operates 35 stores in Minnesota, Wisconsin, Iowa and North Dakota, selling a range of items including fishing, hunting and farm equipment.
The deal was previously set to close in late 2015, however according to reports, no sell-side capital markets desk would finance the billion-dollar deal outright as regulations and the recent high-yield debt debacle constrained liquidity. KKR was forced to self-underwrite a large portion of the debt package. Greene Holcomb Fisher served as exclusive financial advisor to Mills Fleet Farm after initiating the transaction.
While KKR was able to leverage its substantial clout to close the deal, the hiccups were indicative of challenges faced by buyout shops in the current environment. As we noted in our most recent U.S. PE Breakdown Report, the back half of 2015 “officially introduced us to the later stage of the most recent buyout cycle.”