Businessweek

Fortress Investment Group LLC operates as a global investment manager specializing in alternative assets. The company’s alternative investment products include private equity funds, hedge funds and publicly traded alternative investment vehicles. The company is an asset-based investment management firm. FUNDS Private Equity Funds The company’s private equity business is made up of a series of funds named the ‘Fortress Investment Funds’ and organized to make control-oriented investments in cash flow generating, asset-based businesses in North America and Western Europe, with a focus on acquiring and building asset-based businesses with significant cash flows. The company manages two smaller ‘long dated value’ funds focused on investing in undervalued assets with limited cash flows and long investment horizons. Fortress Investment Funds: The company has raised four diversified private equity funds and a series of co-investment funds, from institutional investors and net worth individuals. Its funds have acquired assets and asset-based businesses in 76 transactions. The fortress investment funds seek to generate 20% annual net returns to investors and to return at least two times invested capital. Its funds have averaged 40.0% annualized net returns through September 30, 2006 while at the same time minimizing investment loss. Sectors within which the company’s private equity funds have been active investors include financial services, residential and commercial real estate, senior living, transportation and media/telecommunications. Long Dated Value Funds: The company’s private equity fund product, the Long Dated Value family of funds, focuses on making investments with long dated cash flows. Its investments include rent-stabilized apartment portfolios, residual interests in power plants and oil and gas royalty interests. The long dated value funds are generally similar in structure to the Fortress Investment Fund family of funds. Hedge Funds The company creates and manages hedge fund investment products. Hedge funds, a business that manages AUM comprised of two business segments - hybrid hedge funds, which makes diversified investments globally in undervalued and distressed assets, including loans, assets and corporate securities; and liquid hedge funds – which invests globally in fixed income, currency, equity and commodity markets and related derivatives to capitalize on imbalances in the financial markets. Hybrid Hedge Funds: The hybrid hedge funds investment opportunities are found outside the broker-dealer mediated channels, in which investments that are priced and intermediated by financial institutions are typically presented to the private investment fund community. The company has developed a proprietary network comprised of internal and external resources to source transactions for the funds. The funds are able to invest in various financial instruments, ranging from loans to pools of assets and receivables. Drawbridge Special Opportunities Funds: The drawbridge special opportunities funds form the core of the company’s hybrid hedge fund investing strategy. The drawbridge special opportunities funds make investments. The funds acquire a portfolio of investments primarily throughout the United States, Western Europe and the Pacific region. The funds’ investment program incorporates three investment strategies, focusing on asset-based transactions, loans and corporate securities. The funds acquire and participate in various yield real estate and corporate loans. Asset-based transactions include the acquisition of portfolios of commercial and consumer based tangible assets from undervalued or financially troubled companies, and market purchases of distressed asset-backed securities. The funds also acquire debt and equity securities of companies that are in distress, default or bankruptcy. The majority of the funds’ investments are illiquid, and the funds generally make investments. Fortress Partners Funds: The company’s ‘The Fortress Partners Funds’ investments are made both in Fortress Funds and in funds managed by other managers, and in direct investments that are sourced either by