The transaction builds on an already successful partnership between the two organizations and better positions Fortress to capitalize on opportunities in the global credit markets to further establish itself as a leader in the alternative asset management space.
Fortress Investment Group (“Fortress”) and Mubadala Investment Company (“Mubadala”), through its wholly owned asset management subsidiary Mubadala Capital (“Mubadala Capital”), today announced that they have completed the previously announced acquisition of the 90.01% of the equity of Fortress that was held by SoftBank Group Corp. (“SoftBank”). Terms of the deal were not disclosed.
With the close of the transaction, Fortress management now owns a 32% equity interest in the company in a class of equity entitling Fortress management to appoint a majority of seats on the board. Fortress co-CEOs Drew McKnight and Josh Pack, Managing Partner Jack Neumark, and co-Chairman Pete Briger are the largest individual investors in the buy-out and were joined by approximately 150 members of the firm.
A consortium led by Mubadala Capital now owns 68% of Fortress equity. Mubadala Capital’s CEO and Managing Director, Hani Barhoush, who has served on Fortress’ board since 2019, continues to serve on the board.
As previously announced, Fortress continues to operate as an independent investment manager under the Fortress brand, with full autonomy over investment processes and decision making, personnel and operations.
Under the new joint ownership, Fortress expects to further establish itself as a leader in the alternative investment space, particularly in credit and real estate across public and private markets, where it currently manages over $48 billion of assets on behalf of approximately 2,000 institutional investors and private clients. Fortress expects to benefit from Mubadala Capital’s global network and extensive portfolio of diversified assets, leveraging the companies’ extensive shared experience and resources to expand sourcing channels, build new client relationships and to support strategic growth and expansion.
Fortress co-CEOs Drew McKnight and Joshua Pack said in a joint statement:“This is a true landmark event for Fortress, for our employees and for the clients we serve. Today, approximately 150 eligible members of the Fortress team invested in their colleagues and our collective success, becoming equity owners of a company many of us have been a part of for over 20 years. We have strengthened alignments of interest, put significant management skin in the game, and deepened our long term partnership with Mubadala, one of the world’s most highly regarded investors. With an investment landscape continuing to align with our greatest strengths, we could not be more excited about the future for Fortress, our investors and our employees.”
Hani Barhoush, CEO and Managing Director of Mubadala Capital, said: “Mubadala Capital and Fortress have developed a strong partnership since our initial investment in 2019. The completion of this transaction marks an important step forward as we seek to leverage our combined expertise and global networks to capitalize on emerging opportunities within the alternative investments space. Looking ahead, we are confident that collectively, we will unlock significant value creation opportunities and deliver superior risk adjusted returns to our investors and to Fortress’ stakeholders.”
Ardea Partners served as financial advisor and Shearman & Sterling LLP (now A&O Shearman) served as legal counsel to Mubadala.
Goldman, Sachs & Co. LLC served as financial advisor and Kirkland & Ellis served as legal counsel to Fortress senior management in the transaction. Skadden, Arps, Slate, Meagher & Flom LLP represented Fortress in the transaction.
The Raine Group served as exclusive financial advisor and Morrison Foerster served as legal counsel to SoftBank.
