Fortress Investment Group
Fortress Investment Group is a highly diversified investment management firm operating on a global scale. Founded in 1998 with $400 million in capital and 28 employees, it now manages $41.5 billion of assets. These assets under management represent 1,750 clients worldwide.
Currently, Fortress Investment Group is divided into three segments, which are:
- Credit ($24 billion)
- Credit Hedge Fund ($8.8 billion)
- Private Equity & Permanent Capital Vehicles (8.7 billion)
As a leader in innovation, Fortress has always been on the edge of setting trends. It combines its expertise in pricing, owning, financing, and managing tangible and financial assets with delivering real results for clients. Consequently, it has created a long history of excellence.
Whether dealing with private equity, hedge funds, or corporate mergers and acquisitions, Fortress has been on the front lines of smart moves and wise decisions.
Fortress uses a strategy of “strong risk-adjusted returns,” diversification in asset type, and a global market to leverage its brand as a leader worldwide.
Beginnings: 1998 – 2006
Fortress Investment Group began in 1998. Founded by Wesley R. Edens, Randal Nardone, and Rob Kauffman (retired in 2012), the company started as a private equity company but excelled quickly under the leadership and experience of the founders.
Within the following five years, Fortress had diversified to hedge funds, real estate-related investments, and debt securities. Additionally, the company increased its assets from $400 million to approximately $3.9 billion. Within the decade, assets were valued at $32.6 billion.
In 2007, Fortress Investment Group made headlines by being the first of its kind to go public with an initial public offering (IPO). This represented the first large-scale private equity firm to go public on the New York Stock Exchange (NYSE), thus prompting several other companies to follow suit. To sweeten the deal, Goldman Sachs and Lehman Brothers did the underwriting for the IPO.
Pivotal acquisitions during 2006-2007 included the largest ski resort operator in North America, the Canadian company Intrawest, RailAmerica, Florida East Coast Industries, and Penn National Gaming.
The economic recession in 2008 and 2009 had its impact on the company, but it soon rebounded from the financial adversity facing hedge funds during that time.
In 2010, Fortress acquired American General Financial Services, and its value increased by 27 times to $3.5 billion. The company went on to become Springleaf Financial Services.
Fortress also began to diversify its operations by opening locations in other parts of the world. In 2011, headquarters were opened in San Francisco, Shanghai, and Singapore, thus establishing an Asia connection.
Some other partnerships and acquisitions that occurred during this time include D.B. Zwirn & Co., Logan Circle Partners, Graticule Asset Management Asia, and Mount Kellett.
Year of Change: 2017
In 2017, new changes burst on the horizon for Fortress Investment Group as it became the first investment group to be bought. The company, which still operates as an independent entity, was purchased for $3.3 billion by a Japanese company, SoftBank Group Corporation. This prominent, multinational, financial conglomerate has its headquarters in Tokyo.
Today, Fortress is valued at $41.5 billion of assets under management for over a thousand clients globally. They pride themselves in generating investment performance, which returns well for investors over the long term. With approximately 900 asset management employees and 200 investment professionals at the headquarters in New York and offices around the world, they are a competitive investment manager.
Fortress’s acquisitions and private equity investment portfolio includes Canadian ski resort operator, Florida East Coast Industries (FECI), Aircastle Limited, Alea Group Holdings (Bermuda) Ltd., AMRESCO, Boxclever, Capstead Mortgage Corporation, CW Financial Services, Eurocastle Investment Limited, Flagler, Florida East Coast Railway, GAGFAH, GathHouse Media Inc., Global Signal, Inc., Green Tree Servicing LLC, Holiday Retirement, Intrawest, Inverness Corners retail center, Italofondiario, Kramer Junction, Mapeley Limited, MBS Holdings, MS Hub, Mystays hotels and resorts in Japan, Nationstar Mortgage LLC, Penn National Gaming, Prime Retail, RailAmerica, RESG, Seacastle Inc., Simon Storage, Springleaf Financial, and Umami Burger.
Press and Awards
Fortress Investment Group has achieved many “firsts” in business. From being the first on the NYSE to the first investment group bought by another entity. It has set records and been awarded various titles and honors.
In both 2010 and 2011, Institutional Investor magazine awarded them the “Credit-Focused Fund of the Year” and the “Discretionary Macro-Focused Hedge Fund of the Year.”
In 2014, HFMWeek, the leading publication in the alternative-investment industry, dubbed Fortress with “Management Firm of the Year.” In addition, Institutional Investor named it “Hedge Fund Manager of the Year.”
Randal A. Nardone
Named Forbes Magazine’s World Billionaire’s List in 2007, Randal Nardone serves as the CEO. He’s been in this role since 2103. Before this, he served as a member of the Management Committee after founding the company in 1998.
Wesley R. Edens
A Private Equity expert, Edens devotes much of his time working to bring significant returns for clients even in difficult situations. Prior to this, he was also a founder of the company.
Peter L. Briger