Yet another Los Angeles-based company is bidding the stock market adieu. Kennedy Wilson Holdings, a Beverly Hills real estate investment firm with $65 billion in assets, is set to go private in an all-cash deal valued at $1.65 billion.
A consortium led by the firm’s chair and chief executive, William McMorrow, entered into a privatization agreement expected to close in the second quarter. Toronto-based Fairfax Financial Holdings, a partner in the deal, will control a majority economic interest in Kennedy Wilson while McMorrow will continue to lead operations alongside a group of the firm’s senior executives.
It’ll be the second time Kennedy Wilson, founded in 1977, has delisted. The company went private 11 years after its initial public offering in 1993. It reversed course in 2009, merging with Prospect Acquisition Corp. and raising $110 million in new equity to become public again. The firm has closed roughly $60 billion in transactions since it went public the second time.
Neither Kennedy Wilson nor Fairfax responded to the Business Journal’s requests for comment.
As it prepares to transition to private ownership, Kennedy Wilson’s financial picture shows a firm emerging from a difficult rate-driven downturn. The company narrowed its full-year loss last year, finishing $38.8 million in the red — a steady improvement from 2024 and 88% down from a net loss of $341.8 million in 2023, when higher interest rates led to significant write-downs in property values.
In November, McMorrow’s team of buyers said delisting could unlock savings by eliminating administrative and regulatory burdens, Reuters reported.
The recent deal drew the attention of a law firm that says it is investigating Kennedy Wilson for “possible breaches of fiduciary duty.”
In a Feb. 17 news release, Wisconsin-based shareholder litigation firm Ademi LLP said Kennedy Wilson’s insiders will receive “substantial benefits” as part of the acquisition.
No wrongdoing has been proven.
“The transaction agreement unreasonably limits competing transactions for Kennedy Wilson by imposing a significant penalty if Kennedy Wilson accepts a competing bid,” Ademi said. “We are investigating the conduct of the Kennedy Wilson board of directors, and whether they are fulfilling their fiduciary duties to all shareholders.”
Multifamily moves
The privatization pact also comes as Kennedy Wilson bolsters and bets on its multifamily portfolio. The firm – which manages 24.4 million square feet of industrial, retail and office space across the U.S., the U.K. and Ireland – bought 18 properties and 29 development sites as part of the Pennsylvania-based Toll Brothers Apartment Living platform in September.
The acquisition added $5 billion in managed assets and $1 billion in fee-bearing capital to the company’s portfolio.
In April, Kennedy Wilson partnered with Tokyu Land US Corp. to launch a new preferred equity and mezzanine real estate investment platform focused on lending to sponsors across multifamily and industrial projects.
