Financial Investment giant Fortress Investment Group has been the latest billion dollar acquisition of SoftBank. For a company whose focus is mainly geared towards tech and other startups, many wondered about why they would be interested in acquiring Fortress Investment Group.
Fortress shareholders have approved the deal back in July of 2017 with a price tag of $3.3 Billion. The deal then was fully realized in December of the same year. This particular transaction would only make sense upon checking on each of the company’s background history. Both parties have consistently shown the need to expand and rebrand themselves over the years.
SoftBank was engaged in wholesaling of PC Software titles when it first started in the 80s. Now, the firm has stakes in over 400 companies with various services that would include broadband and technical services. Also involved are companies connected with e-commerce and the internet as well as fixed-line communications and much more. As Fortress Investment Group joins SoftBank’s portfolio, the company’s attemt to be one of the biggest investment conglomerates in the world has been further strengthened.
Fortress Investment group has a newer history compared to SoftBank. The firm has started out in 1998 but has grown to be a global leader in alternative asset management. Based in New York City which is known for its fast pace, Fortress now handles assets of about 1750 or more private investors in addition to their institutional clientele. Even with the acquisition, Fortress will operate on their own and will remain in New York. This comes as a surprise that SoftBank will really have no say with regards to how the firm will manage its nearly $40 billion assets. The real reason though stems from the fact that transactions dealing with overseas firms would be subjected to oversight by the US Committee on Foreign Investments. The agency in turn would only be able to sign off the deal if SoftBank would promise to have a limited control of how assests are being managed.
SoftBank also had to deal with another hurdle to fully realize this acquisition as they had to pay the share price with 9 percent premium. The company was also engaged with other transactions that had to be settled prior to acquiring Fortress Investment. But these were still a small price to pay for SoftBank considering Fortess has been enjoying developments for years, including their distinction of being the first private firm in the US to be offered for public trade.
Their LinkedIn Profile: https://www.linkedin.com/company/fortress-investment-group