Barron’s has some interesting “sum-of-the-parts” analysis on the publicly traded limited partnership units of KKR & Co. L.P. (NYSE:KKR). Says Barron’s:
KKR ran $55 billion in assets across a variety of strategies as of March 31. Simply valuing the management fee stream from these assets at a 15 price-to-earnings multiple, in line with other money managers, and placing a lower multiple on its capital-markets unit, yields $3.25 or so per share in value, fully taxed. Adding the straight book value of its private and public direct investments produces another $6.25 per share, for a total implied value of $9.50, right at the present share price.
The next trick is valuing potential future performance fees on the $27 billion of deals housed in its private-equity funds, as well as those of deals not yet done and funds not yet raised.
One hedge-fund manager who has been buying the stock pencils in as plausible an 8% annual gain in the private funds, calculates the present value of the resulting performance fees (or the 60% of performance fees that flow to shareholders after employees get their taste) and gives this line item a 10 multiple to arrive at $3.70 a share in value. That produces a total sum-of-the-parts target above $13, more than 35% above the current price.
Analysts at Keefe Bruyette & Woods go even further, figuring KKR’s operating business to be worth $9 to $11 per share and the private-equity portfolio worth another $6.22 atop that, for a total value between $15.22 and $17.22.
Greenbackd 
The whole asset management business is changing . . . Very few of the managers can show that they add value. Mutual funds are just the first casualties. Maybe KKR, BX, FIG have a durable enough advantage to survive that. I wouldn’t be surprised to see more money managed by firms like NLY . . . If banks are simply in the borrow short/lend long business, take that out of a bank and let investors invest in it directly.
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I was looking at this stock as a possible buy but there are two problems I have with this stock. Only 30% of the company is being traded in the market and the shares do not have any voting rights.
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interesting. that is unheard of to give a management fee (not under lock I presume) 15x, especially KKR, which I doubt has high quality LPs. and 10x to an incentive! transactions of asset managers never get done at those kinds of levels. there is also no way that the private investments should be given book value in a sotp given the flexibility they have in writing them down (more importantly not writing them down). this seems fair value.
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