KKR has secured US$1.7 billion in debt financing from Barclays, Citigroup, and KKR Capital Markets to support its US$3.1 billion acquisition of OSTTRA, according to sources familiar with the matter.

The financing package includes first- and second-lien debt that will be marketed to investors.

Wall Street banks and private credit firms reportedly competed to finance the deal involving OSTTRA, a joint venture between CME Group and S&P Global.

KKR announced the OSTTRA deal last week, with sale proceeds to be split evenly between CME Group and S&P Global.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Banks regaining ground in the leveraged finance market despite volatility

KKR’s OSTTRA acquisition financing highlights a notable shift in leveraged finance, with banks winning a major deal despite market challenges.

The bank-led $1.7 billion debt package comes amid a period where private credit funds had been gaining significant market share in financing leveraged buyouts, demonstrating banks’ renewed competitiveness in this space1.

This follows a pattern of banks reclaiming territory from direct lenders in recent months, as evidenced by Kaseya’s $3.175 billion loan refinancing and Avalara’s $2.5 billion leveraged loan raise through banks rather than private credit funds.

This transaction represents part of a broader competitive dynamic where banks and private credit providers are actively competing for deals, with banks particularly focused on refinancing opportunities to regain market share.

2️⃣ Post-trade infrastructure emerging as a high-value sector resistant to market cycles

OSTTRA’s $3.1 billion valuation (approximately 12x EBITDA) demonstrates the premium investors place on financial market infrastructure that provides essential services regardless of economic conditions2.

The company processes over 80 million trades monthly across a $600+ trillion OTC derivatives market, highlighting its critical role in the financial ecosystem and explaining KKR’s strategic interest3.

Post-trade services have become increasingly valuable as regulatory requirements grow more complex, with OSTTRA’s solutions helping financial institutions manage everything from risk reduction to regulatory compliance in an increasingly automated trading environment4.

KKR’s acquisition aligns with a broader trend of private equity firms targeting financial infrastructure businesses that feature high barriers to entry, stable cash flows, and essential services that remain in demand regardless of market conditions5.