KKR’s chief financial officer Robert Lewin has warned that consolidation is likely across the private equity industry as firms grapple with a prolonged slowdown in dealmaking, according to Bloomberg.

Speaking at an industry conference, Lewin said many GPs over-deployed capital during 2021 and 2022 and are now struggling to return funds to investors. “You’re going to see a fair bit of GP consolidation over the next five years,” he said. “And that should inure to the bigger players, and certainly the players who’ve been able to deliver on behalf of their clients, and we feel well-positioned there.”

Lewin noted that KKR avoided over-investing during the 2021 boom and stressed the firm’s strong track record of capital returns. Over the past eight years, its Americas private equity franchise has distributed twice as much capital as it has called.

Looking ahead, Lewin highlighted Japan and India as key growth markets. Japan is emerging from decades of deflation, while India benefits from the rise of a growing middle class. KKR manages about $80bn in Asia and is the region’s largest alternatives investor.

The comments underline both the pressure facing mid-sized managers and the advantages of scale for global firms such as KKR, as the industry adapts to slower exits and tougher fundraising conditions.

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