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Alternative Market Briefing

Fortress hedge funds see asset growth in first quarter, but have rough performance in April 2011

Friday, May 06, 2011

From Kirsten Bischoff, Opalesque New York:

Fortress Investment Group (FIG) announced its first quarter results on Thursday morning, and inclusive in those numbers was a large jump in year over year assets. The firm announced that assets under management have grown by 43% to $43.1bn since last March 31 (driven largely by the acquisition of $12bn Logan Capital Partners). However, assets did drop since the end of 2010, which the firm attributed to a $2bn reset as 3 private equity funds concluded their investment periods. First quarter redemptions were $614m. Without those resets, the team said, the firm would have increased assets under management by half a billion dollars during the first quarter of 2011.

Pre-tax distributable earnings were boosted to $103m (up from $96m) "Pre-tax DE increased primarily as a result of improved performance in our Principal Investment segment as well as increased incentive income across the Liquid Hedge Fund and the Credit Hedge Fund segments. The increase in incentive income in the hedge funds was the result of substantially all of the capital eligible to earn incentive income within the main Credit and Liquid Hedge Funds being above their respective high water marks, as of March 31, 2011," says the report.

Assets in the firm’s Liquid Hedge Funds grew to $4.8bn (up from $4.7bn at 2010 year end). The Macro Funds hold $3.7bn and Commodities Funds hold $1.1bn of these assets. Incentive income secured by the Credit Hedge Fund......................

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