SoftBank to pay $3.3bn for Fortress Investment

Fortress's excellent track record speaks for itself' Softbank chief executive Masayoshi Son said of the acquisition

SoftBank Group is buying alternative-asset manager Fortress Investment Group for US$3.3 billion (S$4.7 billion) in cash to operate alongside the Japanese company's soon-to-be-established technology investment fund.

"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", Mr Son said in the statement.

In the Fortress deal, each Class A shareholder will receive $8.08 per share, which represents a premium of 38.6% to the closing price of Fortress Class A common stock on Monday.

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The deal was announced by New York-based Fortress and SoftBank Group today. Pete Briger, Wes Edens and Randy Nardone will also continue to lead the company.

SoftBank previously announced the massive $100 billion technology investment fund - SoftBank Vision Fund - past year with Saudi Arabia.

"SoftBank is not doing a great job in communicating where this fits into their investment strategy", said an analyst at Iwai Cosmo Securities Tomoaki Kawasaki. Mr Briger was hired from Goldman Sachs Group in 2002.

Fortress's senior investment professionals will remain in place and will retain their significant participation interests in fund performance. The stock has soared to a new high for the year.

Fortress is a prominent private equity firm managing a highly diversified range of assets including private equity, credit and real estate.

But the company's performance slumped during the financial crisis and has traded as low as $.077 per share.

To date, SoftBank's plans for this big pile of cash have been less vision and more fund.

Under the terms of the agreement, SoftBank can bring in partners for a portion of the investment.

Since the beginning of 2015, Softbank has announced at least US$44 billion of investments or acquisitions, including its US$30 billion takeover of United Kingdom chip designer ARM Holdings PLC and a US$1.2 billion group-led investment in satellite start-up OneWeb Ltd, data compiled by Bloomberg show.