KKR Income Opportunities Fund (NYSE: KIO), a diversified, closed-end management investment company, has announced the commencement of an at-the-market offering of its common shares. The San Francisco-based fund, which operates under the jurisdiction of Delaware, disclosed on Monday that it entered into a distribution agreement on June 28, 2024, with KKR Capital Markets LLC to offer up to $75 million of its common shares.
The offering will be conducted under the Securities Act of 1933's Rule 415, allowing sales of securities "at the market." This means that KKR Income Opportunities Fund may sell its shares directly on the New York Stock Exchange at prevailing market prices. The fund is restricted from selling shares below its current net asset value, exclusive of any commission or discount.
KKR Capital Markets LLC, a subsidiary of KKR & Co. Inc., will serve as the distributor for this offering. Additionally, a sub-placement agent agreement has been established with UBS Securities LLC to facilitate the sale of the common shares under the distribution agreement.
The KKR Income Opportunities Fund has incorporated by reference the exhibits filed in relation to this offering into the Registration Statement, including the opinion of Dechert LLP regarding the legality of the common shares being offered.
InvestingPro Insights
As KKR Income Opportunities Fund (NYSE: KIO) moves forward with its at-the-market offering, potential investors can gain a deeper understanding of the fund's financial health through InvestingPro metrics. With an adjusted market capitalization of $369.65 million and a low price-to-earnings ratio of 5.1, KIO presents an interesting profile for those looking into the fund's valuation. Additionally, a substantial dividend yield of 10.64% as of mid-2024, coupled with a history of maintaining dividend payments for 12 consecutive years, highlights the fund's commitment to shareholder returns.
InvestingPro Tips suggest that while the fund trades with low price volatility, which may appeal to risk-averse investors, it does face challenges with weak gross profit margins and a valuation that implies a poor free cash flow yield. Moreover, KIO is trading near its 52-week high, with a price 99.27% of that high, indicating strong recent performance in its share price.
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