SoftBank has since agreed to sell its semiconductor unit to its holding company, giving it more funds to invest while shoring up its balance sheet to prepare for an IPO. Fortress Investment Group could remain a unit of SoftBank under a new ownership structure.
Fortress Capital Group LLC, the hedge fund firm’s financial services business, is expected to be sold as well, said the people. They noted that a separate sale process for Fortress’s credit portfolio is likely to begin later this year. SoftBank, for its part, has announced plans to create a new vehicle to manage its cash, although its plans to do so are awaiting regulatory approval.
Under Fortress Investment Group, the Japanese conglomerate bought stakes in ride-hailing companies Uber Technologies Inc. and Didi Chuxing and chipmaker Arm Holdings. It also has stakes in renewable energy company Sunrun Inc. and Snapchat parent Snap Inc.
SoftBank CEO Masayoshi Son has used the New York Fortress to gain stakes in large technology investments. It’s also been a springboard to other asset managers. An offer from SoftBank’s Vision Fund to acquire Fortress would still be an option. The Vision Fund intends to grow to a $100 billion fund from its current size of $93.3 billion.
” Fortress Investment Group is a business that has been brought into SoftBank Group with the potential to create enormous value, but SoftBank can achieve this value without Fortress,” the Vision Fund said in a statement.
The New York Fortress sale would come as Chief Executive Officer Masayoshi Son prepares to bring in a new manager to help bolster Vision Fund. Son has said he plans to increase the $100 billion from about $93 billion after a $5.5 billion fund raised last year. The Fortress Investment Group was no longer the asset manager when SoftBank announced the deal in 2014.
The Japanese firm has since spent billions of dollars building a diverse empire of technology companies from semiconductors to robotics. It now holds stakes in U.S. ride-hailing firm Uber Technologies Inc., shared office space-sharing WeWork Cos., and a controlling share in chipmaker Arm Holdings PLC.