move in the ten year treasury rate, interest rates remain low and the combination of those things results in high prices. KKR & Co (KKR), C-1-8, Buy ¢ Bill Janetschek, Chief Financial Officer, presented for KKR. Overall, Mr. Janetschek believes that KKR’s balance sheet gives them the ability to take advantage of market dislocations, sees opportunities to grow in certain areas (e.g. infrastructure and real estate), and noted that they don’t need to grow the headcount to bring on more assets. e When asked “What would get you more interested in investing in KKR stock?” the most common response was a market pullback for better deployment/returns (50%). Respondents also felt that attractive returns and book value growth (33%), and stronger fee related earnings (17%) were also important. Less important for investors was improving energy markets and overall market confidence (0%). Chart 63: What would get you more interested in investing in KKR stock? 60% 50% 50% 40% 33% 30% 20% 17% 10% 0% 0% Stronger fee related Attractive returns and = Improvingenergy A market pullback for earnings book value growth = markets and overall better market confidence deployment/returns Source: BofA Merrill Lynch Global Research ¢ Overall, KKR likes the publicly traded partnership structure today. If comprehensive tax reform includes an elimination of carried interest tax, the income would still get passed through in that scenario which avoids a second level of taxation, so it still may not be attractive to change the structure. But, if the corporate rate is also lowered significantly, it could potentially make sense to go to a C-corp. ¢ — Bill sees infrastructure as a real growth area for KKR. 7-8 years ago it was difficult to raise an infrastructure fund as the asset class didn’t do very well in the financial crisis; today there is more interest. KKR’s first infrastructure fund was around $1B and the second one was around $3B. Infrastructure needs are tremendous long- term, with $1-