Private Credit

KKR Private Credit Liquidity Explained: How K-FIT Repurchases Work

K-FIT offers periodic liquidity around private loans. Its 5% quarterly repurchase offer is a ceiling, not proof of a gate, and the difference matters.

By The Drift Research Team

Published September 23, 2026. Current-offer details are stated as of this date.

KKR private-credit liquidity is periodic, limited and document-driven. KKR FS Income Trust, known as K-FIT, does not trade on an exchange. Shareholders seek liquidity through discretionary tender offers that the fund has generally conducted quarterly.

The current K-FIT offer illustrates the bargain. The fund is offering to repurchase about 5% of shares outstanding, priced at the fund's September 30 net asset value, or NAV. The offer is scheduled to expire at 11:59 p.m. Eastern Time on September 29, unless extended.

That 5% is a ceiling. It is not evidence that investors have filled it.

In the second quarter of 2026, K-FIT offered to repurchase up to 5% of outstanding shares but received requests equal to only about 1.65%. The fund said it would accept 100% of properly tendered shares.

That is the useful distinction:

A repurchase limit tells you how much liquidity may be available. Tender results tell you how much liquidity investors actually requested.

Private-credit headlines often collapse those two numbers into one alarming word: gate. K-FIT's filings show why investors should read the machinery before reaching for the siren.

KKR private-credit liquidity in one screen

Vehicle: KKR FS Income Trust, or K-FIT, is a non-traded business development company.
Exit mechanism: discretionary tender offers, generally expected four times a year.
Current offer size: up to 2,864,229 Class I shares, approximately 5% of shares outstanding as of June 30, 2026.
Current deadline: September 29, 2026 at 11:59 p.m. Eastern Time, unless extended.
Pricing: NAV per share as of September 30, 2026, or a later valuation date if the offer is extended.
If oversubscribed: accepted shares can be prorated.
Unfilled requests: they do not automatically carry forward or receive priority in a future offer.
Early exit cost: a 2% deduction can apply to certain shares held for less than one year.

The fund offers a path to liquidity. It does not offer daily liquidity or guarantee that every future request will be filled.

First, know which KKR vehicle you own

“KKR private credit” can describe a manager, a strategy or several different investment vehicles. Those are not interchangeable.

K-FIT

KKR FS Income Trust is a non-traded BDC managed by FS/KKR Advisor. It invests primarily in debt securities of private middle-market U.S. companies. Its Class I shares do not trade on an established market, so periodic repurchase offers are an important part of the shareholder-liquidity design.

K-FITS

KKR FS Income Trust Select is a separate non-traded BDC with Class S shares and its own filings, portfolio and tender offers. Its name looks similar. Its legal identity is different.

FSK

FS KKR Capital Corp., ticker FSK, is a publicly traded BDC. An FSK shareholder normally exits by selling shares on the stock market. The market price may be above or below NAV, but the investor does not wait for the BDC to accept a quarterly tender request.

The manager connection is real. The liquidity mechanisms are not the same.

For the public company, read FS KKR Capital Explained. This article focuses on K-FIT.

How the current K-FIT repurchase offer works

K-FIT's September 1 offer is a practical map of semi-liquid private credit.

Step 1: the shareholder submits a tender

The shareholder tenders some or all shares before the deadline. A broker or other intermediary may impose an earlier processing deadline, which is why the fund deadline is not always the investor's practical deadline.

Step 2: the fund counts eligible requests

The offer covers up to 2,864,229 Class I shares. If eligible tenders remain below that amount, the fund says it will purchase all properly tendered shares, subject to the offer's conditions.

Step 3: excess requests are prorated

If eligible tenders exceed the offer amount, the fund accepts shares on a pro-rata basis. The filing also reserves limited discretion to purchase additional shares under the applicable tender-offer rule.

Step 4: the price is set later

The purchase price is based on NAV as of September 30, not the NAV visible when the shareholder submits the request. K-FIT reported NAV of $29.07 per share at June 30 and $29.08 at July 31, but the relevant value for this offer can change before the valuation date.

Step 5: payment follows final NAV

The offer states that payment for accepted shares will occur after the valuation-date NAV is finalized and no later than 65 days after the offer expires.

The investor asks first. Eligibility, capacity, proration and later NAV determine the result.

The 2% early-repurchase deduction

K-FIT's current offer says shares issued after October 1, 2025 are generally subject to a 2% early-repurchase deduction if purchased in the offer. The filing lists exceptions, including certain cases involving death, qualifying disability and divorce. Shares issued through the distribution reinvestment plan are not subject to the deduction.

The deduction is not a market loss and it is not the same as proration.

Deduction: reduces proceeds on eligible recently issued shares.
Proration: reduces the number of tendered shares the fund accepts when requests exceed capacity.
NAV movement: changes the price used to value accepted shares.

All three can affect the cash an investor ultimately receives.

What happened in K-FIT's second-quarter offer?

The second-quarter results are the best antidote to lazy gate language.

K-FIT offered to repurchase up to 5% of shares outstanding as of March 31. Properly tendered requests equaled approximately 1.65% of outstanding shares. Because requests were below the offer size, the fund said it would repurchase 100% of properly tendered and unwithdrawn shares.

The fund also reported that first-half gross subscriptions were approximately $195 million, or 1.9 times total repurchases during that period. Those figures are issuer-reported and should be read as management's description of fund flows, not as an independent verdict on the investment.

What the filing proves is narrower and cleaner:

K-FIT had a 5% quarterly limit, but Q2 requests did not reach it.

A limit can exist without binding. That is why “the fund has a gate” and “investors were gated” are not equivalent statements.

Is K-FIT gated?

K-FIT has limited, discretionary liquidity. Its Board is not required to conduct a future offer, and each tender is governed by its own terms. That is a structural liquidity constraint.

But the Q2 2026 offer was not oversubscribed. Based on K-FIT's June 30 filing, properly submitted requests were expected to be accepted in full.

The Q3 result is not yet known as of September 23. The offer remains open, so nobody can responsibly say whether the current 5% capacity will bind until tender results are filed.

That is the honest answer. The liquidity is conditional. The available evidence does not show that Q2 investors ran into the limit, and Q3 has not finished.

What if Q3 requests exceed 5%?

Suppose shareholders tender 8% of outstanding shares while the offer remains 5%.

The fund would generally accept tendered shares on a pro-rata basis under the offer terms. An investor would receive only part of the requested liquidity. The unaccepted portion would remain invested.

Crucially, the filing says an unaccepted request is not automatically carried forward and receives no priority in a future offer. The shareholder would need to tender again in a later offer, assuming the Board authorizes one.

That resubmission rule is easy to miss and economically important. A quarterly window is not a queue with a guaranteed place in line.

Why the fund uses a liquidity limit

K-FIT owns private-credit assets. Those loans can produce income without trading every day. The same feature makes them harder to sell quickly than public securities.

A repurchase limit gives the manager room to use cash, loan repayments, borrowings or orderly portfolio sales without promising that the loan book can turn into cash on demand. The current offer says repurchases may be funded with cash on hand, borrowings and proceeds from portfolio sales.

The limit can protect remaining shareholders from forced selling. It also limits exiting shareholders. That is not a contradiction. It is the bargain.

K-FIT versus BCRED

K-FIT and Blackstone Private Credit Fund, or BCRED, are non-traded BDCs that use periodic repurchase offers. Both wrap illiquid private loans in vehicles offering limited shareholder liquidity.

The latest demand evidence differs.

K-FIT's Q2 requests equaled approximately 1.65% of shares against a 5% offer, according to K-FIT.
BCRED estimated Q3 requests near 10% of shares and said it would fulfill 5%, subject to finalization.

Those snapshots do not establish which portfolio is better. They show why investors should not transfer one fund's redemption story to every private-credit product.

Structure travels across the category. Tender demand belongs to the specific vehicle and period.

Read Blackstone BCRED Redemptions Explained for the contrasting case.

What investors should inspect before buying

Do not stop at “quarterly liquidity.” Write down the actual rules:

Is the repurchase program mandatory or discretionary?
What percentage of shares can the fund offer to repurchase?
What is the investor's practical submission deadline?
What date determines NAV and the purchase price?
Can requests be prorated?
Do unfilled requests carry forward automatically?
Does an early-repurchase deduction apply?
How long can payment take after the deadline?
Can the offer be extended, amended, postponed or canceled?

Those answers matter more than the word “quarterly.”

What to watch next

The next evidence point is K-FIT's final Q3 tender result after the September 29 deadline. Watch the percentage of shares tendered, whether the 5% limit binds, the final acceptance percentage, the September 30 NAV used for pricing and any subsequent fund-flow commentary.

The Drift will treat an oversubscribed offer as evidence of demand exceeding the period's capacity, not automatic proof of insolvency or portfolio failure. If requests remain below capacity, that is equally important evidence.

Liquidity analysis earns its keep by reporting both outcomes with the same seriousness.

Investor quick answers

What is K-FIT?

KKR FS Income Trust is a non-traded BDC managed by FS/KKR Advisor. It invests primarily in private middle-market credit and seeks current income with some potential for capital appreciation.

Can K-FIT investors redeem quarterly?

K-FIT has generally conducted discretionary quarterly tender offers, but the Board is not required to make a future offer. Each offer has its own deadline, capacity and conditions.

What is K-FIT's repurchase limit?

The September 2026 offer covers approximately 5% of shares outstanding as of June 30. That percentage is the offer capacity, not a guarantee that every tender will be accepted if requests exceed it.

Were K-FIT investors gated in Q2 2026?

K-FIT reported requests equal to approximately 1.65% of shares against a 5% offer and said it would accept 100% of properly tendered shares. The limit did not bind in that offer.

What happens if a K-FIT offer is oversubscribed?

Accepted shares can be prorated. Unaccepted shares remain invested and are not automatically carried forward or given priority in a later offer.

Is K-FIT the same as FSK?

No. K-FIT is a non-traded BDC using periodic tender offers. FSK is a publicly traded BDC whose shareholders normally sell shares on the stock market.

Does K-FIT charge an early-withdrawal fee?

The current offer provides for a 2% early-repurchase deduction on certain shares held for less than one year, subject to stated exceptions. Distribution-reinvestment shares are excluded from that deduction.

Acronyms and terms

BDC: Business Development Company, a regulated investment company designed to provide capital to eligible businesses.
DRIP: Distribution Reinvestment Plan, which uses distributions to purchase additional shares.
FSK: FS KKR Capital Corp., a publicly traded BDC.
K-FIT: KKR FS Income Trust, a non-traded BDC with Class I shares.
K-FITS: KKR FS Income Trust Select, a separate non-traded BDC with Class S shares.
NAV: Net Asset Value, the value of a fund's assets minus liabilities, generally expressed per share.
SEC: U.S. Securities and Exchange Commission.

Source notes

U.S. Securities and Exchange Commission, K-FIT September 1, 2026 Offer to Purchase. This is the primary source for the current 5% offer, September 29 expiration, September 30 valuation date, proration, resubmission rule, payment timing and early-repurchase deduction.
U.S. Securities and Exchange Commission, K-FIT June 30, 2026 Shareholder Letter. This is the issuer source for Q2 requests equal to approximately 1.65% of shares, full acceptance, first-half subscriptions and fund commentary.
U.S. Securities and Exchange Commission, K-FIT Form 10-Q for the quarter ended June 30, 2026. This is the primary source for the vehicle's organization, BDC status and portfolio reporting.
KKR, KKR Income Trust product page. This page describes a related KKR wealth vehicle and its allocation to K-FIT; it is included to clarify that KKR offers multiple products with different legal structures.

Issuer-reported performance, flow and portfolio figures are labeled as such. The Q3 offer is still open as of publication, so this article does not state or imply a final tender result.

This article does not recommend whether any shareholder should tender, redeem, buy, sell or hold a fund interest. Investors should read the complete offer documents and consult qualified professionals about their circumstances.

Disclosure

The Drift is published by Drift Research LLC for informational and educational purposes only. Nothing published by The Drift constitutes personalized investment advice, financial advice, tax advice, accounting advice, legal advice, or a recommendation to buy, sell, or hold any security. The Drift is not a registered investment adviser, broker-dealer, financial planner, or fiduciary. Data and calculations are derived from sources believed reliable and from methods described in the applicable source and calculation notes, but they may contain errors, estimates, rounding differences, or information that has become outdated. Readers should review the original sources and make their own assessment. All investments involve risk, including possible loss of principal. Past performance and hypothetical results do not guarantee future results. Consult qualified professionals before acting.

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