Tue | Aug 22, 2017

Softbank buys Fortress Investment

Published:Thursday | February 16, 2017 | 2:04 PMAP

The US$3.3 billion acquisition by SoftBank Group Corp, the Japanese telecommunications, internet and solar energy giant, of Fortress Investment Group marks tycoon Masayoshi Son's latest step in building an investment empire.

New Fortress Energy, the company that Jamaica Public Service Company has partnered with to deliver LNG to Jamaica, is managed by an affiliate of Fortress Investment Group.

Son said the deal will immediately contribute to his strategy for growth and complement his Softbank Vision Fund plan for investing in leading technologies including artificial intelligence and the ‘internet of things’ which links devices through the Internet.

Tokyo-based Softbank has been aggressive in global acquisitions and has been seeking partners for its private fund for technology investments that it says may grow to US$100 billion. Son appears determined to deliver on his promise to President Donald Trump to invest US$50 billion in US start-ups and create 50,000 jobs.

In buying New York-based Fortress, he is betting more on Fortress's wide ranging expertise and heft in global investment than on gaining any edge in the technology sector: the US investment house has largely focused on finance and real estate, leisure industries, transport and other infrastructure.

Private equity accounts for nearly two-thirds of the company's investments.

Softbank also owns the US wireless company Sprint Corp. and Britain's ARM Holdings, which is known as an innovator in the "internet of things," and in technology used in smartphones.

Fortress said its senior professionals will stay to keep up its fund performance.

Fortress co-chairmen Pete Briger and Wes Edens said the companies have much in common, and the deal will benefit shareholders.

"We join a company with tremendous scale and resources, and a culture completely aligned with our focus on performance, service and innovation," they said in a joint statement.

SoftBank, the first carrier to offer the iPhone in Japan, also sells the Pepper human-shaped companion robot. The company, founded in 1981, has within its investment empire financial technology and ride-booking services. Last week, the company reported its October-December profit soared to about 40 times what it was a year ago.