Kravis at Bear Stearns After working at various jobs in
New York City's financial sector, he and his first cousin,
George R. Roberts, joined the staff of
Bear Stearns. There, they worked under the corporate finance manager,
Jerome Kohlberg, Jr. They both became partners at Bear Stearns at young ages, 30 and 31, respectively. Working for Bear Stearns in the late 1960s and early 1970s, Kravis, alongside Kohlberg and Roberts, began a series of what they described as "bootstrap" investments. In the following years, Kohlberg and later Kravis and Roberts would complete a series of buyouts including Stern Metals (1965), Incom (a division of Rockwood International, 1971), Cobblers Industries (1971), and Boren Clay (1973) as well as Thompson Wire, Eagle Motors and Barrows through their investment in Stern Metals. Although they had a number of highly successful investments, the $27 million investment in Cobblers ended in bankruptcy.
Kohlberg Kravis Roberts By 1976, tensions had built up between Bear Stearns and the trio of Kohlberg, Kravis and Roberts leading to their departure and the formation of
Kohlberg Kravis Roberts (KKR) in that year. Notably, Bear Stearns executive
Cy Lewis had rejected repeated proposals to form a dedicated investment fund within Bear Stearns and Lewis took exception to the amount of time spent on outside activities. Kohlberg invested $100,000 while Kravis and Roberts invested $10,000 each of their own capital in their new firm. Early investors in KKR included the
Hillman Family and the Griffith family (who are also large shareholders in
MGM and
Warner Bros. Discovery). By 1978, with the revision of the
ERISA regulations, the nascent KKR was successful in raising its first institutional fund with approximately $30 million of investor commitments. In 1987, Jerome Kohlberg, Jr. resigned from KKR, and Henry Kravis and George Roberts continued to lead the firm. Under Kravis and Roberts, the firm was responsible for the 1988 leveraged buyout of
RJR Nabisco. At a cost of $31.4 billion, it was then the highest price ever paid for a commercial enterprise. The publicity surrounding the event led to the story being dramatized in the book and film,
Barbarians at the Gate. Kravis was portrayed in the film by actor
Jonathan Pryce. In early 1995, KKR divested its remaining holdings in RJR Nabisco, taking an overall loss on the deal. A journalist for the
New York Times wrote a few years later that "the deal will go down in history as showing just how difficult it can be to get out of a huge deal that goes badly, and of the perils of putting too much money on one investment." KKR pledged not to commit so much of its fund to a single investment again in the future. However, other investments proved more profitable, and the fund still did well overall. The list of companies in which Henry Kravis's KKR has invested over the years includes health care provider
Hospital Corporation of America (HCA), utility company
TXU,
Playtex,
Beatrice Foods,
Safeway,
Toys "R" Us,
Borden,
First Data and
Regal Entertainment Group. A takeover of the battery maker
Duracell proved particularly profitable. In July 2017, Kravis and Roberts announced they would eventually be succeeded by
Joseph Y. Bae and Scott C. Nuttall, who were named co-presidents and co-chief operating officers so they might gradually take over daily operations. ==Personal life==