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A U.S. Private Equity Firm Has Officially Delisted for the First Time Ever

Updated on
  • Japanese tech investor agreed to $3.3 billion deal in February
  • PE firm’s shares tumbled almost 58 percent since 2007 IPO
Photographer: Kiyoshi Ota/Bloomberg

Japan’s SoftBank Group Corp. has completed its $3.3 billion cash deal for Fortress Investment Group LLC, marking the first time a publicly traded U.S. private equity firm has delisted.

Trading in Fortress shares was halted before Wednesday morning’s announcement. Its stock closed its last day of trading Tuesday at $7.85 a share, almost 58 percent below the 2007 initial public offering price.

SoftBank, a technology-focused investor, struck the deal to buy Fortress for $8.08 a share in February. The price was 39 percent above the stock’s close the day before the acquisition was announced.

Fortress’s day-to-day operations and investing style hasn’t changed because of the acquisition, Fortress Co-Chairman Wes Edens said in September in a Bloomberg TV interview.

“It hasn’t changed it much other than that we don’t have to do earnings calls,” he said. “We’re rooting for being private. I’m excited about that.”

Fortress, founded by Edens and Chief Executive Officer Randy Nardone in 1998, will operate independently and remain headquartered in New York, SoftBank said Wednesday in a statement. The Japanese company, led by founder Masayoshi Son, said it’s committed to maintaining Fortress’s management, business model, brand, employees, processes and culture.

In addition to private equity, Fortress operates a credit business, led by Co-Chairman Pete Briger. The firm, with assets of $36.1 billion as of Sept. 30, this year sold its Logan Circle Partners fixed-income business, which oversaw more than $30 billion.

One of the world’s biggest technology investors, SoftBank has raised large commitments from Saudi Arabia, Apple Inc. and other backers for its $97 billion Vision Fund. In November, a SoftBank-led consortium clinched a deal to inject up to $10 billion in ride-hailing service Uber Technologies Inc.

(Updates with deal premium paid in third paragraph.)
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