KKR's next $1B deal could be from WAMU shell

|By:, SA News Editor

Characterizing WMI Holdings (WMIH +1.7%) as a "KKR special purpose acquisition vehicle," hedge funder Stephen Errico, thinks the P-E firm will move ahead with acquisitions which can utilize WMI's nearly $6B in tax loss carryforwards.

WMIH is more than a double since KKR in December announced plans for a strategic investment in the firm, and last month closed on the purchase of convertible stock, committed to buying a chunk of subordinated debt, and received 5-year warrants to purchase common stock.

"Expect acquisitions to be announced sooner rather than later," says Errico, calling WMIH a small cap, speculative way to invest alongside KKR.