Fortress Investment Group had a very exciting 2018. The international asset manager was purchased by Softbank in a whopping $3.3 billion dollar purchase. The integration into the Japanese conglomerate is a move into unfamiliar territory for Softbank, and a continuation of core goals for Fortress.
The New York-based private equity firm came to be in 1998. It was created by co-founders Wes Edens, Randal Nardone, and Rob Kauffman. Fortress has had a good run in the realm of private equity and real estate. It has financed technological advances, retail developments, and numerous start-up companies. Its main interest has always been in the cutting edge, and Fortress is known for looking at the big picture. At the time of its purchase Fortress was in charge of over $40 billion assets worldwide. More about Fortress Investment Group here.
Softbank is known primarily for its financing of information. The conglomerate is made up of ownership stakes in telecom companies and new economy firms. So far this has allowed it to become a driving force for innovative tech. Its overall strategy includes a lot of large-scale projects that seem to combine tech with infrastructure. Fortress Investment Group is Softbank’s first integration of an investment management firm.
The purchase does not bring a lot of change with it. Fortress Investment Group will remain the same. The company went public many years ago as it gained its international status, so the biggest “change” will be a return to private status. It will retain control over its day-to-day and will continue with its numerous projects. Softbank will gain a seat at the table and will be part of Fortress’s board but will not influence its decisions. Essentially, it will be a subsidiary of Softbank and the conglomerate will use Fortress Investment Group to make investments and partake in developments.
The main aspect of Softbank’s purchase of Fortress seems to revolve around the Vision Fund. This is a strategy that pushes the boundaries of advancing technology. It is up both Softbank and Fortress’s alley. Their integration is a way for them to work together in various aspects to push the vision fund forward. Softbank also gains access to Fortress’s services and products with the ability to offer them to its current clients.