KKR deal completed despite crunch

First Data is one of the biggest processors of credit card payments

The private equity company Kohlberg Kravis Roberts (KKR) has completed its $26bn (£13bn) takeover of the credit card payment processor First Data Corp.

The deal was reported to have been threatened by a credit crunch that has hit the banks from which much of the money was borrowed.

It is the second biggest private equity buyout, behind the $45bn paid for the US utility firm TXU.

Private equity firms raise money from private investors and borrow the rest.

It is an alternative to going to the stock market and selling shares to raise the money, but it does rely on the banks being able to lend large amounts of cash.

The banks that underwrote this deal did so before the credit crunch because they expected to be able to spread the debt among other banks.

But, as many banks have found themselves holding debt of questionable value backed by US mortgages, they have been reluctant to take on any more debt.

That has made it difficult for banks to spread around the huge cost of such big deals.

In turn that has led to new private equity deals all but drying up completely.

There had also been some concern about existing deals running into problems, the first of which was First Data, but the completion of the deal will go some way to calming those fears.