SCHEDULE: Kennedy-Wilson Insider Group Bids $10.25/Share

William J. McMorrow and Fairfax Financial Holdings propose to acquire all outstanding shares of Kennedy-Wilson Holdings, Inc. not already owned by the consortium for $10.25 per share in cash.

Summary

• William J. McMorrow and affiliates of Fairfax Financial Holdings Limited (the "Consortium") have proposed to acquire all outstanding common stock of Kennedy-Wilson Holdings, Inc. not currently owned by them.
• The offer price is $10.25 per share in cash.
• The Consortium, through Kona Management Holdco, LLC (owned and controlled by McMorrow) and Fairfax affiliates, beneficially owns approximately 31% of the Issuer's common stock on an as-converted basis.
• The Proposal was delivered to the Board of Directors on November 4, 2025.
• The Consortium is only interested in acquiring the remaining shares and not selling their existing holdings.
• They expect the Board to establish a special committee of independent directors to evaluate the proposal.

Sentiment

Score: 7

Explanation: The proposal offers a clear cash value for shareholders, which can be positive for liquidity and certainty. However, the 'no sell' stance from the Consortium and the right to withdraw the offer introduce some uncertainty and potential for limited upside beyond the offer price.

Positives

• A concrete offer of $10.25 per share in cash provides a clear valuation for non-consortium shareholders, offering liquidity and certainty.
• The proposal suggests the formation of a Special Committee of independent directors, which is a standard governance practice to ensure fairness for minority shareholders.
• The Consortium's stated intent not to sell their shares indicates a strong commitment to the proposed transaction, potentially reducing market uncertainty regarding their future intentions.

Negatives

• The offer price of $10.25 per share may be perceived as low by some shareholders, especially if the stock has traded higher historically or if future growth prospects are strong.
• The Consortium explicitly states they are not interested in selling their shares, which could limit options for other potential bidders or a higher offer.
• No assurances are given that a definitive agreement will be reached or that the transaction will be consummated, creating uncertainty for shareholders.

Risks

• The Proposed Transaction may not be consummated, as the Consortium reserves the right to modify or withdraw the Proposal at any time, with or without prior notice.
• The Board of Directors or the Special Committee may not accept the Proposal, or may demand a higher price or different terms, leading to potential deal failure.
• If the transaction is completed, it could result in the delisting of the Common Stock from the New York Stock Exchange, impacting liquidity for remaining shareholders.
• The transaction could lead to other material changes in the Issuer's business or corporate structure.

Future Outlook

The Consortium expects the Board to establish a special committee of independent directors to evaluate the proposal. They plan to engage in discussions and negotiations with the Board and the Special Committee. No assurances are given that a definitive agreement will be reached or that the Proposed Transaction will be consummated, and the Consortium reserves the right to modify or withdraw the Proposal at any time.

Management Comments

• The members of the Consortium are only interested in acquiring the outstanding Common Stock of the Issuer that they do not already own, and are not interested in selling their Common Stock to another party.
• The Consortium expects the Board will establish a special committee of independent directors fully empowered to select and retain its own independent legal and financial advisors.

Industry Context

This proposal represents a potential take-private transaction, a common strategy in the real estate and investment sectors, especially for companies where management or significant shareholders believe the public market undervalues the company or where greater operational flexibility is desired without public scrutiny. Such transactions often occur when market conditions or specific company circumstances make private ownership more attractive.

Corporate Governance

Related Party Transactions

• The proposal is made by William J. McMorrow (CEO and Chairman of Kennedy-Wilson) and affiliates of Fairfax Financial Holdings Limited, who are significant existing shareholders. This constitutes a related-party transaction due to McMorrow's role and substantial ownership.
• Kona Management Holdco, LLC, a newly formed entity owned and controlled by McMorrow, is part of the Consortium.

Stakeholder Impact

• Shareholders: Non-consortium shareholders could receive $10.25 per share in cash, providing liquidity and a defined exit price. However, they lose potential future upside if the company performs well.
• Employees: A take-private transaction could lead to changes in corporate strategy, operations, or management, potentially impacting employee roles or compensation, though not explicitly stated.
• Management: William J. McMorrow, as a key member of the Consortium, would gain greater control and flexibility over the company's direction if the transaction is completed.

Next Steps

• The Board of Directors is expected to establish a special committee of independent directors to evaluate the Proposal.
• The Consortium plans to engage in discussions and negotiations with the Board and the Special Committee and their advisors.
• The Consortium may engage advisors, communicate with various parties, and take actions regarding prospective debt and/or equity financing.
• The Reporting Persons do not intend to update disclosures until a definitive agreement is reached or unless required by law.

Key Dates

Recommendation

The filing presents a concrete cash offer for Kennedy-Wilson shares at $10.25. While this provides a clear exit for shareholders, the offer is a proposal and not a definitive agreement. There's a possibility of a higher offer if the Special Committee negotiates effectively, but also a risk of the offer being withdrawn. Given the uncertainty and the potential for negotiation, a 'hold' recommendation allows investors to await further developments, particularly the Special Committee's response, without locking in the current proposed price or exiting prematurely. The Consortium's 'not interested in selling' stance limits the likelihood of a competing bid, but the Special Committee's role is to ensure the best outcome for minority shareholders.

Keywords

Kennedy-Wilson Holdings, KWH, William J. McMorrow, Fairfax Financial Holdings, take-private, going private, Schedule 13D, merger, acquisition, real estate, investment, common stock, share acquisition, Kona Management Holdco