KKR seeks partnerships as it expands in Middle East

* Head of regional office says mood is more positive

* Says access to debt improving, activity up

By Megan Davies and Nicolas Parasie

DUBAI, Oct 12 (Reuters) - Private equity giant Kohlberg Kravis Roberts & Co [KKR.UL] is seeking to invest in the Middle East and North Africa by striking partnerships and teaming up with local players, the head of its MENA office said on Monday.

Makram Azar, appointed in September 2008 to establish a presence for KKR in the region, said the economic situation, in terms of debt and equity markets, has been improving and he is more confident about investment opportunities.

"The situation has been getting better. You can feel it and hear it, particularly talking to people in the region," Azar said at the Super Return private equity conference in Dubai. "People are feeling more positive ... they have more money in their pockets."

KKR, which has struck some of the biggest buyout deals in history, has along with other private equity firms been doing deals of a different nature since the credit crunch.

That includes a joint venture deal it struck with media group Bertelsmann [BERT.UL] and a debt investment in photography company Eastman Kodak Co EK.N.

Azar said KKR has a similarly flexible approach to deals in the Middle East and is willing to strike partnerships with existing firms, large families and sovereign wealth funds as it builds a presence in the region.

He said debt markets are reviving, and the overall picture is one of gradual recovery. Private equity firms that have been sitting on the sidelines are very active again, he added.

"The question in this new environment is, 'Can we still do deals and raise capital?'" he said. "My answer is yes to both. However, in the current environment, private equity deals will be smaller, involve more equity, have less favorable debt terms, be fewer in number, and will be less dependent on debt." (Reporting by Megan Davies and Nicolas Parasie; editing by John Wallace)