Henry Kravis co-founded Kohlberg Kravis Roberts & Co. He was born in Oklahoma to an oil engineer who had business ties with President John F. Kennedy’s father. His family sent him to California to study economics at Claremont McKenna College, after which he attended Columbia University, gaining an MBA in 1969.
That same year, Henry Kravis and his cousin George Roberts successfully entered Bear Stearns. Under the supervision of Jerome Kohlberg, the duo gained an interest in leveraged buyouts. The business model was fairly simple: seek out debt-ridden companies, borrow capital to assume them, stabilize their balance sheets, and sell them for profit. Unfortunately, Bear Sterns looked down on these excursions.
Disenchanted, Kravis, Kohlberg, and Roberts departed from the firm, paving the way for KKR in 1976. The trio had a head start with such names as Lily-Tulip, Houdaille, and finally, a billion-dollar deal in Wometco.
But Henry Kravis did not become a business icon until KKR’s aggressive takeover of RJR Nabisco, the titanic American food conglomerate. KKR coughed up $25 billion, the biggest amount for a leveraged buyout. It was a record only beaten by KKR’s own acquisition of TXU in 2007.
New York City-based Henry Kravis is active as much in the social scene as the private equity industry. He is a trustee of the Metropolitan Museum and the New York City Ballet. He is also on the boards of Mount Sinai Hospital and Rockefeller University.
