SoftBank Group to Acquire Fortress Investment Group for $3.3 Billion

15-Feb-2017 Intellasia | BusinessWire | 6:08 AM Print This Post

Acquisition Brings Additional Investment Leadership and Expertise
to SoftBank

Fortress Principals to Continue to Lead Business Independently

TOKYO & NEW YORK–(BUSINESS WIRE)–SoftBank Group Corp. (“SoftBank” or “SBG”) and Fortress Investment Group
LLC (NYSE:FIG) (“Fortress”) today announced that they have entered into
a definitive merger agreement under which SoftBank will acquire Fortress
for approximately $3.3 billion in cash.

Under the terms of the merger agreement, which was unanimously approved
by a Special Committee of Independent Directors of Fortress’s Board of
Directors and Fortress’s full Board of Directors, each Fortress Class A
shareholder will receive $8.08 per share, which represents a premium of
38.6% to the closing price of Fortress Class A common stock on February
13, 2017, and a premium of 51.2% to Fortress’s 3-month volume-weighted
average price, excluding dividends. In addition, each Fortress Class A
shareholder may receive up to two regular quarterly dividends prior to
the closing, each in an amount not to exceed $0.09 per Class A Share.
Fortress plans to maintain its current base dividend of $0.09 per share
for the fourth quarter of 2016 and, if closing does not occur prior to
the applicable payment date, for the first quarter of 2017.

Pete Briger, Wes Edens and Randy Nardone (the “Fortress Principals”)
have agreed to continue to lead Fortress, and have committed to invest
50% of their after-tax proceeds from the transaction in Fortress-managed
funds and vehicles, underscoring a deep alignment with the interests of
Fortress’s limited partner investors, and in equity securities of
SoftBank and SoftBank-managed funds and vehicles. In addition, the
Fortress Principals have agreed to vote shares representing an aggregate
of 34.99% of the outstanding Fortress voting shares held by them in
favor of the transaction.

Fortress’s senior investment professionals will remain in place and will
retain their significant participation interests in fund performance.
Fortress will operate within SoftBank as an independent business
headquartered in New York, and SoftBank is committed to maintaining the
leadership, business model, brand, personnel, processes and culture that
have supported Fortress’s success to date.

Fortress’s excellent track record speaks for itself, and we look
forward to benefitting from its leadership, broad-based expertise and
world-class investment platform,” said Masayoshi Son, Chairman and CEO
of SoftBank Group Corp. “For SoftBank, this opportunity will immediately
help expand our group capabilities, and, alongside our
soon-to-be-established SoftBank Vision Fund platform, will accelerate
our SoftBank 2.0 transformation strategy of bold, disciplined investment
and world class execution to drive sustainable long-term growth.”

SoftBank is an extraordinary company that has thrived under the
visionary leadership of Masayoshi Son,” said Fortress Co-Chairmen Pete
Briger and Wes Edens. “We are very pleased to announce an agreement
setting our business on a great path forward as part of SoftBank, while
creating significant value for our shareholders. We join a company with
tremendous scale and resources, and a culture completely aligned with
our focus on performance, service and innovation. We anticipate
substantial benefits for our investors and business as a whole, and we
have never been more optimistic about our prospects going forward.”

Under the terms of the agreement, SoftBank can bring in partners for a
portion of the investment. Nizar Al-Bassam and Dalinc Ariburnu of F.A.B.
Partners, who arranged the transaction, will continue to advise SoftBank
with respect to Fortress.

The transaction is subject to approval by Fortress shareholders, certain
regulatory approvals and other customary closing conditions, and is
expected to close in the second half of 2017.

Advisors

J.P. Morgan Securities LLC acted as financial advisor, Weil, Gotshal &
Manges LLP and Kirkland & Ellis LLP provided legal counsel, and KPMG LLP
acted as accounting and tax advisor to SoftBank. Morgan Stanley & Co.
LLC acted as financial advisor, and Skadden, Arps, Slate, Meagher & Flom
LLP provided legal counsel to Fortress. Paul, Weiss, Rifkind, Wharton &
Garrison LLP provided legal counsel to the Fortress Principals. Evercore
acted as financial advisor, and Davis Polk & Wardwell LLP provided legal
counsel to the Special Committee of Fortress’s Board of Directors.

About SoftBank Group

The SoftBank Group is a global technology player that aspires to drive
the Information Revolution. The SoftBank Group is comprised of the
holding company SoftBank Group Corp. (TOKYO: 9984) and its global
portfolio of companies, which includes advanced telecommunications,
internet services, AI, smart robotics, IoT and clean energy technology
providers. In September 2016, ARM Holdings plc, the world’s leading
semiconductor IP company, joined the SoftBank Group. To learn more,
please visit www.softbank.com.

About Fortress

Fortress Investment Group LLC is a leading, highly diversified global
investment firm with 1,100 employees and $70.1 billion in assets under
management as of September 30, 2016. Founded in 1998, Fortress manages
assets on behalf of over 1,750 institutional clients and private
investors worldwide across a range of private equity, credit, real
estate and traditional asset management strategies. Fortress is publicly
traded on the New York Stock Exchange (NYSE: FIG). For additional
information, please visit www.fortress.com.

Cautionary Note Regarding Forward-Looking Statements

Certain statements in this press release may constitute “forward-looking
statements” within the meaning of the Private Securities Litigation
Reform Act of 1995. These statements are generally identified by the use
of words such as “outlook,” “believe,” “expect,” “potential,”
“continue,” “may,” “will,” “should,” “could,” “would,” “seek,”
“approximately,” “predict,” “intend,” “plan,” “estimate,” “anticipate,”
“opportunity,” “pipeline,” “comfortable,” “assume,” “remain,”
“maintain,” “sustain,” “achieve” or the negative version of those words
or other comparable words. Forward-looking statements are not historical
facts, but instead represent only Fortress’s beliefs as of the date of
this press release regarding future events, many of which, by their
nature, are inherently uncertain and outside of Fortress’s control.
Numerous factors could cause actual events to differ from these
forward-looking statements, and any such differences could cause our
actual results to differ materially from the results expressed or
implied by these forward-looking statements. Such factors include but
are not limited to the following: (1) Fortress may be unable to obtain
shareholder approval as required for the proposed merger; (2) conditions
to the closing of the merger, including the obtaining of required
regulatory approvals, may not be satisfied; (3) the merger may involve
unexpected costs, liabilities or delays; (4) the business of Fortress
may suffer as a result of uncertainty surrounding the merger; (5) the
outcome of any legal proceedings related to the merger; (6) Fortress may
be adversely affected by other economic, business, and/or competitive
factors, including the net asset value of assets in certain of
Fortress’s funds; (7) the occurrence of any event, change or other
circumstances that could give rise to the termination of the merger
agreement; (8) risks that the merger disrupts current plans and
operations and the potential difficulties in employee retention as a
result of the merger; (9) other risks to consummation of the merger,
including the risk that the merger will not be consummated within the
expected time period or at all; and (10) the risks described from time
to time in Fortress’s reports filed with the SEC under the heading “Risk
Factors,” including the Annual Report on Form 10-K for the fiscal year
ended December 31, 2015, Quarterly Reports on Form 10-Q and Current
Reports on Form 8-K and in other of Fortress’s filings with the SEC. In
addition, new risks and uncertainties emerge from time to time, and it
is not possible for Fortress to predict or assess the impact of every
factor that may cause its actual results to differ from those expressed
or implied in any forward-looking statements.

Accordingly, you should not place undue reliance on any forward-looking
statements contained in this press release, and you should not regard
any forward-looking statement as a representation by Fortress or any
other person that the future plans, estimates or expectations currently
contemplated by Fortress will be achieved. Fortress can give no
assurance that the expectations of any forward-looking statement will be
obtained. Such forward-looking statements speak only as of the date of
this press release. Fortress expressly disclaims any obligation to
release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in Fortress’s
expectations with regard thereto or any change in events, conditions or
circumstances on which any statement is based.

Important Additional Information

In connection with the proposed merger, Fortress intends to file
relevant materials with the SEC, including a preliminary proxy statement
on Schedule 14A. Following the filing of the definitive proxy statement
with the SEC, Fortress will mail the definitive proxy statement and a
proxy card to each shareholder entitled to vote at the special meeting
relating to the proposed merger. SHAREHOLDERS ARE URGED TO CAREFULLY
READ THESE MATERIALS IN THEIR ENTIRETY (INCLUDING ANY AMENDMENTS OR
SUPPLEMENTS THERETO) AND ANY OTHER RELEVANT DOCUMENTS THAT FORTRESS WILL
FILE OR FURNISH WITH THE SEC WHEN THEY BECOME AVAILABLE BECAUSE THEY
WILL CONTAIN IMPORTANT INFORMATION. The proxy statement and other
relevant materials (when available), and any and all documents filed or
furnished by Fortress with the SEC, may also be obtained for free at the
SEC’s website at www.sec.gov.
In addition, shareholders may obtain free copies of the documents filed
with the SEC by Fortress via Fortress’s Public Shareholders section of
its website at www.fortress.com
or by contacting Investor Relations.

This document does not constitute a solicitation of proxy, an offer to
purchase or a solicitation of an offer to sell any securities. Fortress,
its directors, executive officers and certain employees may be deemed to
be participants in the solicitation of proxies from the shareholders of
Fortress in connection with the proposed merger. Information about the
persons who may, under the rules of the SEC, be considered to be
participants in the solicitation of Fortress’s shareholders in
connection with the proposed merger, and any interest they have in the
proposed merger, will be set forth in the definitive proxy statement
when it is filed with the SEC. Additional information regarding these
individuals is set forth in Fortress’s proxy statement for its 2016
Annual Meeting of Shareholders, which was filed with the SEC on April 8,
2016, and its Annual Report on Form 10-K for the fiscal year ended
December 31, 2015, which was filed with the SEC on February 25, 2016.
These documents (when available) may be obtained for free at the SEC’s
website at www.sec.gov,
and via Fortress Public Shareholders section of its website at www.fortress.com.

Contacts

SoftBank Group
Japan:
SoftBank Group Corp. Corporate
Communications
+81.3.6889.2300
[email protected]
or
United
States:
Sard Verbinnen & Co
[email protected]
or
San
Francisco

Paul Kranhold / Megan Bouchier, +1 415-618-8750
or
New
York

Jim Barron / Ben Spicehandler, +1 212-687-8080
or
Fortress
Gordon
E. Runté, +1 212-798-6082

 


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