Form 4: Accel-KKR Funds Restructure Paymentus Holdings Stake

Accel-KKR entities reported an in-kind pro rata distribution of Paymentus Holdings Class B Common Stock to their partners, restructuring indirect beneficial ownership.

Summary

• Accel-KKR Holdings GP, LLC, a Director and 10% Owner of Paymentus Holdings, Inc. (PAY), along with several affiliated funds, reported changes in beneficial ownership.
• The transactions, dated November 17, 2025, involved an in-kind pro rata distribution of Class B Common Stock from certain Accel-KKR entities to their partners, without consideration.
• Class B Common Stock is convertible at any time into an equal number of Class A Common Stock shares and has no expiration date.
• Accel-KKR Capital Partners CV III, LP disposed of 3,602,968 shares, resulting in a beneficial ownership of 21,395,285 shares.
• Accel-KKR Members Fund, LLC disposed of 180,352 shares, resulting in a beneficial ownership of 1,183,406 shares.
• Accel-KKR Growth Capital Partners III, LP disposed of 151,676 shares, resulting in a beneficial ownership of 900,687 shares.
• Accel-KKR Growth Capital Partners II Strategic Fund, LP disposed of 5,084 shares, resulting in a beneficial ownership of 30,184 shares.
• Accel-KKR Growth Capital Partners II, LP disposed of 59,920 shares, resulting in a beneficial ownership of 355,825 shares.
• AKKR Strategic Capital LP now beneficially owns 5,364,707 shares, which includes 303,450 shares received from other reporting persons in the distribution.
• AKKR SC GPI HoldCo LP now beneficially owns 820,762 shares, which includes 59,077 shares received from other reporting persons in the distribution.
• The overall beneficial ownership of the Accel-KKR group, controlled by Mr. Palumbo and Mr. Barnds, remains substantial, with Accel-KKR Holdings GP, LLC maintaining its status as a Director and 10% Owner.

Sentiment

Score: 5

Explanation: Neutral. The filing reports an internal restructuring of beneficial ownership among related entities, which is a routine event for large institutional investors and does not inherently signal positive or negative sentiment for the issuer's operational performance or future prospects.

Future Outlook

NA

Industry Context

This filing reflects an internal portfolio management action by a private equity firm, Accel-KKR, regarding its stake in a portfolio company, Paymentus Holdings. Such in-kind distributions to partners are a common practice for private equity funds as investments mature or as part of their realization strategy, rather than indicating a change in the operational landscape of Paymentus Holdings' industry.

Comparison to Industry Standards

• In-kind distributions are a standard practice for private equity firms like Accel-KKR, particularly as an investment matures or as part of an exit strategy, allowing shares to be transferred to limited partners without a market sale.
• Similar distributions have been observed from other major private equity firms, such as Blackstone, KKR, and Carlyle Group, where shares of publicly traded portfolio companies are distributed to their limited partners to manage tax implications or provide direct liquidity.
• Examples include Vista Equity Partners distributing shares of Mindbody or Silver Lake Partners distributing shares of Dell Technologies, which were also internal restructurings of ownership rather than direct market sales impacting stock price.

Related Party Transactions

• The reported transactions involve in-kind pro rata distributions of Class B Common Stock from Accel-KKR entities to their partners, which are considered related party dealings.

Stakeholder Impact

• Shareholders of Paymentus Holdings: The direct impact is minimal as the overall beneficial ownership by the Accel-KKR group remains substantial, and the shares were not sold into the open market.
• Partners of Accel-KKR Funds: These partners receive direct ownership of Paymentus Holdings shares, potentially providing them with direct liquidity or increased investment flexibility.

Next Steps

• Mr. Palumbo and Mr. Barnds have separately filed Form 4s reporting their individual interests related to these transactions.

Key Dates

Recommendation

The Form 4 filing details an internal restructuring of beneficial ownership by Accel-KKR entities, involving an in-kind distribution of Paymentus Holdings Class B Common Stock to their partners. This is a routine portfolio management activity for private equity firms and does not reflect on the operational performance or future prospects of Paymentus Holdings itself. As such, it provides no new fundamental information to warrant a change in investment recommendation. Investors should continue to hold based on their existing analysis of Paymentus's business fundamentals.

Keywords

Paymentus Holdings, PAY, Accel-KKR, Form 4, Beneficial Ownership, Insider Transaction, Equity Distribution, Class B Common Stock, Institutional Investor