Mubadala & Fortress Management agree to acquire Fortress Investment Group

By Arya M Nair, Official Reporter
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Fortress Investment Group acquisition

Mubadala Investment Company, through its wholly-owned asset management subsidiary Mubadala Capital, and Fortress Investment Group (Fortress), an American investment management firm, have entered into definitive agreements to acquire 90.01 percent of the equity of Fortress that is currently held by SoftBank Group Corp. (SoftBank), who have been the owners of Fortress since 2017.

After the transaction close, Fortress management is expected to own a 30 percent equity interest in the company and will hold a class of equity entitling Fortress management to appoint a majority of seats on the board. Mubadala Capital, which currently holds a 9.99 percent stake in Fortress through its Private Equity Funds II and III, will own 70 percent of Fortress equity.

After the closing, Fortress will continue to operate as an independent investment manager under the Fortress brand, with full autonomy over investment processes and decision-making, personnel and operations. Mr. Drew McKnight and Mr. Joshua Pack will be appointed co-CEOs of Fortress and Mr. Pete Briger will be appointed Chairman. Mubadala Capital’s CEO and Managing Director, Mr. Hani Barhoush, who has served on Fortress’ board since 2019, will continue to serve on the board.

Hani Barhoush_Fortress Investment Group acquisition
Hani Barhoush
Mubadala Capital

“Fortress is a world-leading investment manager with a proven track record of delivering superior risk-adjusted returns to its investors throughout business cycles. Over the last 20 years, they have built an incredible franchise and established themselves as a premier credit and asset investor while simultaneously growing investment strategies across a wide range of asset classes. We have a strong existing relationship with Fortress’ exceptional management team, and are excited to deepen the relationship further in the years ahead based on a strong alignment of vision, while delivering even greater value to our investors.”

Under the new joint ownership, Fortress is expected to generate significant value for its stakeholders by further establishing itself in the alternative investment space, particularly in credit and real estate across public and private markets, where it currently manages $46 billion of assets on behalf of more than 1,900 institutional investors and private clients. Fortress is expected to benefit from Mubadala Capital’s global network and extensive portfolio of diversified assets, as well as its access to proprietary investment opportunities to support its growth and expansion.

Fortress’ Mr. Pete Briger, Mr. Drew McKnight and Mr. Joshua Pack said in a joint statement, “We are extremely pleased to deepen our relationship with Mubadala, partnering with one of the world’s most sophisticated investors in a transaction that will provide significant long-term benefits to our company, our employees and the clients we serve. We have worked closely with Mubadala for years and have enormous respect for their investment acumen and discipline.”

“We view Mubadala’s further investment as an affirmation of the business model and investment approach we have embraced for more than 20 years, and, at a time when market dynamics are better aligned than ever before with our experience and expertise, we could not be more excited about the future of Fortress,” they added.

Related: Emirates International Investment Company acquires minority stake in ADIB