On August 25, Harley-Davidson announced the sales of “residual interests in securitized consumer loan receivables” to KKR, a leading global investment firm, and PIMCO, a global leader in active fixed income. This strategic partnership transforms HDFS into a capital-light financing business through the sale of existing and future retail loans while maintaining its strategic value to Harley-Davidson, its dealers, customers and investors, according to the statement.
“Since we announced our strategic partnership with KKR and PIMCO earlier this quarter, we have made excellent progress on our path to completing the transaction, and we are pleased to have achieved this major milestone with our partners so quickly,” claims outgoing Harley-Davidson Chairman, President and CEO Jochen Zeitz. “Completing this step eliminates approximately $2 billion in variable interest entities and $1.8 billion of debt from our balance sheet, while generating more than $230 million of proceeds that we plan to use to support the capital allocation priorities we set forth when we announced the transaction.”
Strategic Partnership Bullet Points
• HDFS has sold 95% of the residual interests in certain securitized consumer loan receivables to investment vehicles managed by KKR and PIMCO at a premium to par value for gross proceeds of more than $230 million.
• Residual interests sold represented aggregate retail loan receivables of approximately $2 billion and related debt of approximately $1.8 billion at June 30, 2025.
• HDFS is targeting completion of the remaining aspects of the transaction, including the sale of 4.9% common equity interests at an agreed $1.8 billion valuation to each partner, and the existing consumer retail loan receivables by the end of October. Upon completion of the transaction, investment vehicles managed by KKR and PIMCO will begin acquiring new consumer retail loan receivables originated by HDFS.
“We are on track to complete the transaction as planned and begin the next phase of our partnership, all while continuing to deliver outstanding service levels for our dealers and customers,” concludes Zeitz. “This transaction delivers benefits to all of Harley-Davidson’s stakeholders and marks the beginning of an exciting new chapter for HDFS.”
