Ever since its establishment in 1988, Softbank continuously expands its focus from one area to another. For instance, it was once a company dealing with the wholesale of PC software before moving on to other areas such as tech, broadband, internet, e-commerce and many others. Fortunately, all the changes have been suiting it perfectly as it continues to expand and remains competitive at the same time. Even though today it is a global conglomerate and owns stakes in over 400 million firms, it seems that it is not yet done as it recently signed a $3.3 billion acquisition deal with Fortress Investment Group.
If most businesses were to achieve the prominence that Softbank boasts today, most would be satisfied and would not go through all the trouble that the firm went through just to have Fortress Investment group as its branch. In fact, most businesses would steer as far away as they can from the deal considering that even though it cost Softbank a whopping $3.3 billion, the Japanese firm still has no say on FIG’s assets. SoftBank to Buy Fortress Investment Group for $3.3 Billion.
Besides being quite an expensive deal, Softbank had to overcome other hurdles to complete the transaction. For instance, the firm had to pay a 39% premium to Fortress’s share price. It also had to transfer 25% of its stake in the UK’s arm holding to its investment fund, and on top of it all, its founder, Masayoshi had to pledge a $50 billion investment in the US.
Nevertheless, all the trouble was worth it considering that the acquisition of Fortress investment group will turn Softbank into one of the largest investment firms globally. Additionally, the $3.3 billion deal does not come as a surprise as Softbank has the habit of splashing money on investments it has set its eyes on. Fortunately, they always work and bring huge returns and considering the history of Fortress this one will be even bigger.
About Fortress investment group
Fortress is an asset management company based in New York and was established in 1998. The firm went public during the 2007 NYSE, but after the acquisition deal between it and Softbank, it has had the opportunity to go private again. Apart from asset management, Fortress also deals with credit funds and real estate. It is currently valued at over $40 billion and has over 900 employees.