Nomura Holdings will pay $88 million for a 15% stake in eight-year-old Fortress Investment Group, according to the Dow Jones. The Japanese brokerage is looking to strengthen its position in alternative investment products and wants to diversify its portfolio of businesses.
Traditionally, Nomura has relied on executing trades to generate the bulk of its revenue. But liberalization and the growth of electronic trading has eroded commissions and forced the brokerage to look for new business.
Nomura has made several investments to expand its range of investment services. In March, it invested $54.2 million to establish an online brokerage called Joinvest Securities. In November, Nomura announced it would pay $1.2 billion to buy New York-based electronic stock trading company Instinet, in the hopes of deploying Instinet’s electronic trading platform in Asia.
The deal comes as Fortress prepares for an initial public offering of its shares, which will make it one of the few alternative investment companies to sell stock to the public. The company filed a prospectus with U.S. regulators early last month.
The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.