Sunday, 26 February 2017

Softbank buys investment firm Fortress for $3.3bn

By Nick Wood, Total Telecom
Wednesday 15 February 17

Acquisition brings in additional expertise ahead of venture capital fund launch.

Softbank on Wednesday agreed a $3.3 billion (€3.13 billion) acquisition of Fortress Investment, a U.S.-based asset management firm. The publicly-listed company boasts 1,750 institutional clients and private investors…

Softbank on Wednesday agreed a $3.3 billion (€3.13 billion) acquisition of Fortress Investment, a U.S.-based asset management firm.

The publicly-listed company boasts 1,750 institutional clients and private investors. At the end of September, it managed $70.1 billion worth of assets.

"Fortress's excellent track record speaks for itself, and we look forward to benefiting from its leadership, broad-based expertise and world-class investment platform," said Softbank CEO Masayoshi Son.

Indeed, the deal comes as Softbank prepares to launch a $100 billion venture capital arm, the Softbank Vision Fund.

Under the terms of Wednesday's deal, Fortress's senior figures – co-chairman Peter Briger, co-founder and co-chairman Wesley Edens, and co-founder and CEO Randal Nardone – have agreed to stay on. They have also committed to invest 50% of their net proceeds from the transaction into Fortress-managed funds and vehicles, and in equity securities of Softbank and Softbank-managed funds and vehicles.

"We join a company with tremendous scale and resources, and a culture completely aligned with our focus on performance, service and innovation," said Briger and Edens. "We anticipate substantial benefits for our investors and business as a whole, and we have never been more optimistic about our prospects going forward."

The acquisition has been unanimously approved by a special committee of Fortress's independent directors, and by Fortress's full board. Shareholders will receive $8.08 per share, representing a 38.6% premium on Fortress's closing share price on 13 February.

The deal is subject to customary closing conditions; Softbank and Fortress expect to complete the deal in the second half of the year.

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