Sat, Nov 28, 2015
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Industry Updates

Fortress expands capabilities with acquisition of fixed income manager Logan Circle Partners

Wednesday, February 17, 2010
Opalesque Industry update – Fortress Investment Group has completed the acquisition of U.S.-based bond investment shop Logan Circle Partners, L.P. from Guggenheim Partners, LLC., as part of a move to get more involved in traditional investment management and to offer fixed income products to investors across the globe.

Daniel Mudd, Fortress’s CEO said the firm would pay approximately $21m in cash with the potential for an additional payment at the end of 2011, consistent with the growth and performance of Logan Circle's business. The transaction is expected to close by the end of the second quarter of 2010, following regulatory approvals.

Fortress Group, with headquarters in New York and $32bn in AuM (as of end Sept. 09), will absorb roughly $12bn of assets from its acquisition of Logan Circle, which manages portfolios for institutional investors in strategies that include core/core plus, short, intermediate and long duration, corporate and high yield.

Mudd said in a statement: "We believe this is a unique opportunity to diversify and expand Fortress’s investment management business. Logan Circle has a high quality management team and a fundamental credit focus which is complementary to our existing approach.” Logan Circle’s founder Jude Driscoll and his portfolio management and research team will join Fortress. He said that while his firm’s investment approach and the day-to-day operations would remain the same, Fortress's size and global infrastructure, along with its intellectual capital and transaction flow would meaningfully enhance Logan Circle’s ability to build its platform. Driscoll and the senior leadership team at Logan Circle will continue to manage the business, which will report directly to Mudd.

According to a report by today, there is a growing trend amongst large private-equity firms to expand their assets under management by making acquisitions, although it is more difficult for them to raise new capital. Last month Blackstone Group acquired $3.2bn in debt funds from Allied Capital Corp., and Apollo Global Management is bidding on the real-estate private equity assets being offered for sale by Citigroup Inc. The report added that Fortress’s acquisition of Logan Cicle would broaden its capital base beyond the lucrative but riskier private equity and hedge fund assets.

Alternative investment managers such as Fortress and Citadel started looking for good credit portfolio managers and firms late last year in the “mess” within the investment management business that followed the credit crisis, according to

Last December, Fortress launched a $500m Japan real estate fund as it saw demand for distressed and global macro strategies could benefit investors. Fortress’s CEO Mudd said at the time that capital was flowing back into hedge funds.

The group also sued law firm Dechert LLP in connection with the $700m Ponzi scheme perpetrated by lawyer Marc Dreier that month. And it elected not to pay a dividend in the fourth quarter of 2009. Indeed, the group posted a third quarter loss and a decline in total assets in early November; its shares were down 5% or 23 cents at $4.34.

Fortress’s stock closed up 5 cents at $4.10 yesterday (16-Feb).

– PD & BG –

press release.


What do you think?

   Use "anonymous" as my name    |   Alert me via email on new comments   |   
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Other Voices: Hedge fund marketing and the selling cycle[more]

    By Bruce Frumerman. How long is the selling cycle now? That’s a question my financial communications and sales marketing consulting firm has been asked on a regular basis by hedge fund firm owners and sales people, ever since we opened the doors to our firm in 1987 pre-crash. Wa

  2. People - Solus Alternative Asset Management adds chief strategist from BTIG[more]

    From Daniel Greenhaus joined hedge fund manager Solus Alternative Asset Management as managing director and chief strategist. He will work closely with Chris Bondy, Solus’ chief economist, managing director and executive vice president, said Chris Pucillo, CEO and chief investmen

  3. Opalesque Roundtable: Seeding deal terms can be onerous for hedge funds[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Executives from fund of funds firms, family offices, a placement agent, a private equity firm, and an accounting firm gathered in Connecticut last month for the

  4. Opalesque Roundtable: Family offices flock to co-investment[more]

    Bailey McCann, Opalesque New York: Co-investments have been a hot topic for pension funds in recent years, as they try to move away from high fees and improve transparency. But now, family offices are more readily getting into the mix and establishing in-house deal teams, according to the delega

  5. More institutional investors invest in CTAs compared to last year despite dissatisfaction with performance[more]

    Benedicte Gravrand, Opalesque Geneva: "Despite a strong start to 2015 for CTAs in Q1, commodity market conditions have made return generation difficult for fund managers over much of the rest of the year to date," says Preqin’s November