SoftBank to Purchase Fortress Investment Group LLC for Approx. $3.3 Billion

Company - Pavan Pandey - Feb 15,2017

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softbank to purchase fortress investment group llc for approx 33 billion dollars

On Wednesday, Japan’s SoftBank Group Corp. said it has agreed to purchase a US-based investment management company, Fortress Investment Group, for about $3.3 billion.

Japanese multinational telecommunication company, SoftBank Group Corp., is looking to add investment proficiency as it prepares to strike up the world’s largest private equity fund.

This newly proposed deal comes after the founder of SoftBank Group Corp., Mr. Masayashi Son, made the surprise statement in October last year that SoftBank is teaming up with Saudi Arabia to make a $100 billion technology fund.

The all-cash arrangement is SoftBank's first main cash injection in an investment fund and signifies another random strategy for a group that has focused on technology and telecoms till date.

According to a statement, Japan’s SoftBank Group Corp. will pay $8.08 per share for Fortress Investment Group, a 39% premium to the investment company’s February 13 closing value. 

Fortress heads Mr. Pete Briger, Randy Nardone and Wes Edens have agreed to continue leading the business, which will remain centered in New York City and work independently within SoftBank.

A New York-listed asset manager; Fortress Investment Group LLC's investments span real estate, private equity and hedge funds.

Global investment management firm, Fortress had $70 billion in investments under management at the end of September in 2016, and is one of few international foreign investors with funds that are focused on Japanese assets.

In the wake of the worldwide financial disaster, Fortress took bad loans in Italy and has a track record in Japan, where the investment management company bought hotels held by Lehman Brothers Holdings Inc. after the bank shrunken in 2008.

The procurement, subject to authorization by Fortress stakeholders as well as watchdogs, is projected to close in the second half.

On Tuesday, shares of Fortress Investment Group closed up 6.5% at $6.21, giving the company a market worth of approximately $2.4 billion.