2017-02-14 18:49:15
SoftBank of Japan Will Buy U.S. Private Equity Giant Fortress

Over its three-decade existence, the Japanese conglomerate SoftBank and its founder, Masayoshi Son, have been known for ambitious and sometimes head-scratching moves.

Now, SoftBank is nearing its most unusual move yet: It is about to buy Fortress Investment Group, an American private equity giant that oversees around $70 billion in assets.

That business is a radical departure from the technology and telecommunications holdings for which the Japanese company is known. But the acquisition is intended to bolster SoftBank’s other enormous new endeavor: a $100 billion technology investment fund that threatens to roil the private equity world.

The move highlights the immense ambitions of SoftBank’s brash founder, Mr. Son. The mogul, who is one of Japan’s richest men, has sought to shake up the American telecommunications industry and recently sought to win over President Trump by announcing intentions to create jobs in the United States.

Over the past three decades, SoftBank has become one of Japan’s most formidable technology companies. It is perhaps best known for its telecommunications empire, which stretches from Japan to Sprint in the United States.

At its helm, the entire time, has been Mr. Son. An American-trained engineer, Mr. Son began the business as a software distributor, but eventually moved into cellphone service and became the first Japanese carrier to embrace the iPhone. He has never been known for his modesty, repeatedly boasting about outsize ambitions like dethroning Verizon and AT&T atop the American wireless industry with Sprint.

SoftBank will be paying $3.3 billion for Fortress, a premium to the company’s public market value of $2.3 billion.

The purchase of Fortress, a prominent private equity firm with a specialty in investing in distressed assets, was driven by Rajeev Misra, a former top derivatives expert at Deutsche Bank who has taken a leading role insetting investment strategy for the vision fund.

The deal may not have been done if SoftBank did not also have a $100 billion investment fund that it was starting.

The Japanese company now oversees assets under management of $170 billion, making it one of the largest private investors in the world after the Blackstone Group, which manages about $330 billion.

Representatives for SoftBank and Fortress were not immediately available for comment.