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Can value
 still 
be created?
Kohlberg Kravis roberts & Co.
2008 AnnuAl Review
 
Contents
Letter from Our Founders
 
1
Operational and Strategic Review
 
8
 
KKR
’s Integrated Approach to Value Creation
 
28
Dedicated Process for Value Creation
 
30
 
KKR
Portfolio Company Case Studies
 
49
Investments of the
KKR
Private Equity Funds
 
61
 
letter from our founders
Two thousand eight was a year o severe dislocation andextraordinary challenge. It began with many predicting aneconomic slowdown and ended, as ar ewer anticipated,with the economy mired in the worst nancial contractionsince the
1930
s.There were many ramications o the year’s turmoil,including a sharp increase in unemployment, a widespreaddecline in asset prices, a all in global industrial activityand the dismantling o institutions once thought to beindispensable to capital ormation. Even more traumaticwas the erosion o trust in nancial institutions, in businessand in capitalism itsel. Capitalism relies on condence:condence that markets are ecient, that economicbehavior is rational, that risk can be assessed and managedand, most importantly, that measures o value accuratelyrepresent actual underlying value. The events o 
2008
 undermined this condence and, with it, many o theinvestment community’s deepest convictions. It will takethe collective eorts o many organizations to restorethe trust necessary or capitalism to fourish once again.Know that at
KKR
, we strive to earn your trust each dayand intend to maintain your condence through goodtimes and bad.As we write this letter in April
2009
, the nancial andeconomic outlook remains sobering. Industrial activity,consumer spending, the housing market and unemploy-ment gures, together, indicate a long and protractedglobal slowdown. Global debt and equity markets con-tinue to experience turbulence. While progress has beenmade by governments to stabilize markets, signicantwork remains to be done. Although the challenges aredaunting, we remain condent that they will be overcomethrough the eorts o the public and private sectorsworking together.
KKR
is committed to helping cratsolutions to the problems acing global markets inclose cooperation with other institutions.
 In the wake o the events o 
2008
, we asked ourselvesa difcult question: Can value still be created? The answer is yes. This Annual Review shows how.
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