Fortress would consider going private

The management of NYSE-listed asset manager, Fortress Investment Group, would consider taking the firm private, said chief executive Randy Nardone during an earnings call today (30 October).

Responding to a question from an analyst, Nardone remarked that management had not been shy about share buybacks and would consider taking the firm private if the opportunity presented itself.

Earlier in the call, Nardone said that the current share price did not reflect the firm’s intrinsic value. The stock was trading at €7.20 a share on 29 October, according to Bloomberg.

Fortress’ management are already majority shareholders in the firm.

Nardone also said that the firm believes that the opportunities in Europe to buy-up non-performing loan portfolios from banks keen to shed assets was over-hyped and that demand outstripped supply. 

Commenting on reports that Fortress is seeking to raise $4 billion for a new distressed fund, Nardone said that fundraising must be counter-cyclical.

“Because credit is expensive and frothy and hopefully down the road it will lead to a higher default rate,” Nardone said.

On the credit side, management said the firm was raising three ‘next generation’ PE-style funds, a fourth global opportunities fund, a third Japan fund and its second real estate fund.

The firm reported a 49 percent year-on-year fall in net income from €166 million in the first nine months of 2013 to €85 million to 30 September 2014.