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August 20, 2007

Subprime Lenders Thornburg Mortgage and KKR Financial Will Surivive

posted by MR WAVETHEORY at 8/20/2007 05:29:00 PM
The worst is over for Thornburg (NYSE TMA) and KKR Financial (NYSE KFN). Thornburg Mortgage has sold off its non performing assets.

The Santa Fe, N.M., lender, said the move will result in a $930 million capital loss, of which Thornburg has previously reserved $700 million. Thornburg will also take a $40 million gain for the termination of its interest rate hedges.
KKR Financial is raising mad money.

Kohlberg Kravis Roberts said Monday that it will raise $230 million by selling 16 million shares to investors Farallon Capital Management, Fir Tree Partners, JGE Capital Management, Marsico Capital Management, Morgan Stanley, Oak Hill Advisors and Sageview Capital. The company also seeks to raise an added $270 million through a rights offering under which current shareholders will have the option to buy a new share at $14.40 apiece for every five shares they hold. Kohlberg Kravis agreed to buy $100 million worth of stock should the rights offering fail to be fully subscribed.

These stocks are going to survive and now question is at what price are they buys.

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