Watch stocks you care about
The single, easiest way to keep track of all the stocks that matter...
Your own personalized stock watchlist!
It's a 100% FREE Motley Fool service...
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of KKR Financial Holdings LLC (NYSE: KFN ) soared 27% today after private equity giant KKR & Co. (NYSE: KKR ) agreed to acquire the specialty finance company, which it already manages, for $2.6 billion.
So what: The all-stock deal -- 0.51 common units of KKR for each KKR Financial share held -- values KKR Financial at $12.79 per share and represents a premium of 35% of its Monday closing price. KKR is making the move to expand and diversify its asset base, but judging from its own stock's 3% plunge today, Mr. Market isn't thrilled with the price management is paying to do it.
Now what: The deal is expected to close in the first half of 2014. "Through this transaction, we are acquiring a business with a fully invested, complementary portfolio of assets while increasing the scale and diversity of KKR's balance sheet," said KKR Co-Chairmen and Co-CEOs Henry Kravis and George Roberts. "Furthermore, through the distribution of KFN's realized earnings, the transaction is expected to provide a meaningfully greater recurring component to KKR's distribution and also be immediately accretive on a total distribution per unit basis."
So while KFN's upside might be limited at this point, KKR's bolstered asset base and improved yield profile are certainly worth looking into.
More juicy income opportunities
Dividend stocks can make you rich. It's as simple as that. While they don't garner the notoriety of high-flying growth stocks, they're also less likely to crash and burn. And over the long term, the compounding effect of the quarterly payouts, as well as their growth, adds up faster than most investors imagine. With this in mind, our analysts sat down to identify the absolute best of the best when it comes to rock-solid dividend stocks, drawing up a list in this free report of nine that fit the bill. To discover the identities of these companies before the rest of the market catches on, you can download this valuable free report by simply clicking here now.