It was announced today that Fortress will be raising as much as $750 million in the first U.S.-listed IPO of an alternative investment manager with over $24 billion under management and net-profits of $240+ million. I think what is brilliant is that this will provide investment opportunity for those investors who were previously unable to touch this industry. Keeping in mind that the particular non-correlated asset class is still out of reach, owners will benefit from the profits through dividends. I think this will be an interesting experiment and one worth paying attention to.
On another note - it was mentioned in Forbes that Hedge funds increasingly are pressuring executives to either shape things up or ship out, but a new study suggests their demands aren't doing much to improve the financial health of the companies they target.
Staggering...
"The NYU study of 155 cases of such activism from 2003 to 2005 found that hedge funds were always successful in replacing CEOs they were trying to oust. Seventy-three percent of the time they won board seats and they prevented 56 percent of mergers, according the findings by April Klein, an accounting professor at NYU's Leonard N. Stern School of Business, and doctoral student Emanuel Zur.
More importantly, these investors saw the shares in the companies they targeted climb 16.5 percent on average over the year after their initial investment, compared with a gain of about 7 percent for a control group made up of companies of similar size and profile, the study said. Dividend payments per share almost doubled during that time."
