K-FITS Tender Offer, NAV and Fees: KKR FS Income Trust Select

K-FITS in plain terms: what you hold and who can buy it

"K-FITS" is the short name for KKR FS Income Trust Select. It lends mostly to large private companies: at June 30, 2026, 74.4% of the portfolio was first-lien senior secured loans and 25.3% was asset-based finance (loans against pools of consumer, residential, commercial and other collateral), per the 10-Q. The adviser is FS/KKR Advisor, LLC, which also advises FS KKR Capital Corp (see FS KKR Capital's NAV, dividend and non-accruals) and K-FIT, the sister fund covered in our K-FIT redemptions page.

Three facts that readers often get wrong:

• It is its own fund. K-FITS reports its own portfolio (149 companies at June 30, 2026), its own borrowings and its own NAV. K-FIT is a different registrant (CIK 1930679) with 175 portfolio companies and a different share class.
• Only accredited investors can buy. The 10-Q says each investor in the private offering represents that it is an “accredited investor” as defined in Regulation D. The filings I read give no dollar minimum for a first purchase; the only minimum is the $500 account balance a holder must keep if tendering part of a position (Offer to Purchase). Not verified: any broker's own minimum.
• The class name is inconsistent. The 10-K, the 10-Q balance sheet and the tender offer call the shares Class S (0.85% servicing fee). The monthly 8-Ks have called the same shares Class I since late 2025, and so does the unregistered-sales section of the June 10-Q. There is only one class on the balance sheet: 40,509,275 Class S shares at June 30, 2026.

The fund had 5,386 record holders at February 28, 2026 and no beneficial owner above 5% (10-K). Two large holders appear in other filings: Cliffwater Corporate Lending Fund held 992,566 shares, 3.1%, at September 30, 2025 and waived voting above 4.99% (Schedule 13G/A; see our Cliffwater CCLFX repurchase page), and a KKR subsidiary, Global Atlantic, reported 1,000,687 shares, 6.3%, in March 2025 (Schedule 13D/A). The September offer also lists 400,315 shares, 1.09%, held by a seed vehicle of Franklin Square Holdings; no trustee or officer intends to tender.

The September 2026 offer, term by term

Everything below is from the Schedule TO-I filed September 1, 2026 and its Offer to Purchase, unless noted.

Three lines are worth reading closely. The offer is “not conditioned on any minimum amount of Shares being tendered”, but the fund can cancel, amend or postpone if, among other things, there is a “material decrease in the net asset value of the Company from the net asset value of the Company as of the commencement of the Offer.” It says what a large payout can cost the shareholders who stay: payment “may require the Company to liquidate portfolio holdings earlier than the Adviser would otherwise have caused these holdings to be liquidated.” And a cut-back holder gets no queue position: the unaccepted part “shall not be automatically carried forward or given priority in connection with any future tender offer.”

Because this offer was not prorated, none of that bit in September. For a wirehouse client the practical point is the intermediary deadline, which comes before the 11:59 p.m. fund deadline.

What changed since the June offer

The offer shrank by 4,719 shares because the share count fell by 94,387 (our arithmetic). That is the first quarter-over-quarter decline in K-FITS history in the tender documents: shares outstanding had risen at every earlier offer. One drafting slip in June: the June Offer to Purchase says the shares offered “represent approximately 5% of the outstanding Shares as of March 31, 2025”; the number of shares offered equals 5% of the March 31, 2026 count, so the year is a typo. The September text says June 30, 2026.

Nine quarters of K-FITS tenders

Each row is the fund's own result filing. “Outstanding” is the share count the offer gives as of the previous quarter-end.

Ratios in the “Tendered / limit” column are our arithmetic. Tendered shares as a share of shares outstanding went from under 1% through December 2025 to 3.66% in March, 3.43% in June and 5.06% in September 2026 (our arithmetic). In March the first result amendment (April 1) said 1,354,538.636 shares; the final amendment says 1,350,591.597.

NAV and flows since December 2025

NAV fell $0.73 a share, 2.9%, between December 31, 2025 and August 31, 2026 (our arithmetic). Most of it came in the first quarter: H1 unrealized depreciation on non-controlled investments was $21.5 million, while the second quarter's was $1.4 million (10-Q). Aggregate NAV in the July 8-K is printed as “approximately $986.7 billion”; it can only mean million.

The closings add up to the 10-Q: April, May and June sold $20.677 million, the Q2 “issuance of common shares” line. July, August and September add to $23.3 million (our sum). The 10-Q shows Q2 share transactions as a net outflow of $2.2 million: issuance $20.7 million plus $10.8 million of reinvested distributions, less $33.7 million of repurchases. That $33.7 million is the cash of the March tender; the $34.6 million of the June tender falls in the third quarter, and the September offer's cash comes after that.

Distributions: $0.175 a month and a return-of-capital line

The monthly distribution was $0.20 a share through October 2025 and $0.175 from the December 31, 2025 record date (8-Ks of October 8 and December 8, 2025). It was declared again at $0.175 for September 30 and for October 30, 2026 (payable on or about November 25). At the $24.85 August NAV that is 8.45% a year (our arithmetic); the fund's letter rounds to 8.5%.

All the return of capital sits in the second quarter: the three-month column of the statement of changes in net assets and the six-month column show the same $8,232 thousand. In the first quarter net investment income covered the payout (our arithmetic: $35,871 thousand less $17,428 thousand is $18,443 thousand, against $20,798 thousand of distributions, about 89%). Retained earnings moved from plus $5,161 thousand at December 31, 2025 to a deficit of $24,916 thousand at June 30, 2026. The six-month total return on NAV was 1.23%, against 5.75% a year earlier (10-Q). The September 30 shareholder letter still reports “positive total returns in 29 out of 30 months since inception in February 2024” and an annualized inception-to-date net return of 8.64%, with the fund's footnote that the figures reflect adviser fee waivers through September 30, 2025.

What it costs to hold K-FITS

There is one share class on the balance sheet, so “fees by class” is one fee table, from the 10-Q. K-FIT's table, from its own 10-Q, is shown for comparison.

The gap is 0.89 percentage points (our arithmetic): 0.85 of servicing fee plus 0.12 of other expenses, less 0.08 of lower interest. The table assumes borrowing of about 76% of average net assets, and the fine print says buyers may also pay up to 3.0% as a sales load, or, at certain broker-dealers, a placement agent fee of 0.50% up to 1.5%, with the sum of the sales load and the placement fee not above 3.5% of the offering price. Those are paid to the selling agent, on top of the purchase price. Check what your wirehouse actually charged.

The adviser's incentive fee is 12.5% of pre-incentive net investment income above a 5.0% annualized hurdle, with a catch-up until income reaches 5.72% a year, and 12.5% of cumulative realized gains (10-Q). The adviser waived the base and income incentive fees through September 30, 2025. In the first half of 2025 the waivers were $6.5 million; in the first half of 2026 there were none, and the charges were $6.2 million of management fees, $5.5 million of income incentive fees, a $1.6 million reversal of the capital gains fee, and $4.0 million of servicing fees. Interest expense was $18.1 million, 25% of investment income of $71.6 million (our arithmetic).

Leverage and liquidity

Debt was $572.9 million against net assets of $1,006.1 million, 0.57 times (our arithmetic); the fund's September letter puts debt-to-equity at 0.63x at August 31, 2026. Asset coverage was 276%, against the 150% minimum that applies to this fund under the Investment Company Act of 1940, and total investments were 154.4% of net assets. Borrowings fell from $604.1 million at December 31, 2025 while the Mount Royal line was added.

On September 30, 2026 the fund signed a second amendment to the ING revolver: the margin on term benchmark loans rose from 2.125% to 2.25%, commitments rose from $325 million to $375 million, the commitment period now ends September 30, 2030 and maturity is September 30, 2031, with an accordion up to $800 million (Form 8-K, accession 0001104659-26-113259).

Liquidity has two sides. The letter counts about $718 million of cash plus line availability at August 31. Against that, the 10-Q lists $279.4 million of unfunded debt commitments and $9.1 million of unfunded equity commitments at June 30, together $288.5 million (our arithmetic), and only $31.7 million of cash. The September offer, if every tendered share were paid at the August NAV, would cost about $51.0 million (our arithmetic: 2,051,610.547 shares at $24.85); the real price is the September 30 NAV.

Portfolio and non-accruals

At June 30, 2026 the fund held 149 companies with a median loan-to-value of 39%, a weighted average yield on debt investments of 8.8%, 83.6% of debt at variable rates and, in its words, no investments on non-accrual (10-Q). The letter repeats “a non-accrual rate of 0bps (0.00%)” at August 31 and reports 152 issuers in 18 industries.

Software is the largest exposure at about a fifth of the portfolio, which matters if you worry about disruption to software borrowers. Non-accruals are one measure; so are realized losses. Q2 2026 net realized losses on non-controlled investments were $4.5 million, against $0.2 million a year earlier (10-Q).

One structural item: under a facility agreement with Cliffwater Corporate Lending Fund and its financing provider, loans are held for K-FITS at its request before it buys them. At July 31, 2026 that vehicle held 15 loans with $102.9 million of commitment par ($26.4 million unfunded), and K-FITS bought $7.9 million of investments from it in the first half. The conditions for K-FITS to be obliged to buy more had not been met at June 30 (10-Q).

What a holder can do with this

• If you tendered in September: the fund accepted all of what was tendered, so no proration applies. The price is the September 30 NAV, which was not on EDGAR on October 15. The earlier result amendments with the exact price came about four weeks after quarter-end (April 27 and July 24, 2026). Cash is due by December 3, 2026 at the latest.
• If you want to tender in December: the offer document is usually filed on the first business day of the quarter's last month; the next one would be for 5% of the shares outstanding at September 30, 2026. With September requests at 5.06%, a December request level of 5% or more would leave the fund two choices: use the extra 2% again or prorate. The offer documents leave that to the fund and its board.
• If you were cut back: nothing carries over; tender again. In K-FITS's history no offer has been prorated so far.
• If you bought in the past 12 months: shares issued after October 1, 2025 carry the 2% early deduction in this offer, except those from distribution reinvestment.
• If you hold it for income: the third-quarter 10-Q, due in November, will show whether return of capital continues beyond the second quarter. Return of capital lowers your cost basis rather than being taxed as income now; the fund determines tax attributes annually and reports them on Form 1099-DIV. See how tender offer funds work and what a BDC is.
• Tax on a tender: the Offer to Purchase says a tender generally is treated as a sale under Section 302(b) of the Internal Revenue Code if you tender all your shares or meet the ownership-reduction tests, and that a loss can be disallowed under the wash sale rules if you acquire shares, including by reinvestment, within 30 days before or after. Ask your CPA how this applies to you.
• Compare: the private credit redemptions tracker and the non-traded BDC list line up other funds.

FAQ

All figures are from SEC filings by KKR FS Income Trust Select (CIK 1975736), plus the K-FIT Form 10-Q (CIK 1930679, accession 0001628280-26-056131) for the fee comparison, read on EDGAR on October 15, 2026: the Schedule TO-I of September 1, 2026 with its Offer to Purchase and exhibits (accession 0001104659-26-104154), the Schedule TO-I/A and shareholder letter of October 5 and September 30, 2026 (0001104659-26-113727), the earlier eight Schedules TO-I and their result amendments (September 2024 to July 2026), the monthly Forms 8-K on NAV, sales and distributions (October 2025 to October 2026), the Form 8-K on the ING credit-line amendment (0001104659-26-113259), the Form 10-Q for June 30, 2026 (0001628280-26-056136), the Form 10-K for 2025 (0001628280-26-017328), and Schedules 13D/A (0001140361-25-007656) and 13G/A (0001104659-25-112838). Ratios, sums and differences marked as our arithmetic are our calculations. This is analysis of public documents, not investment, legal or tax advice.