New York-based investment management firm
Fortress Investment Group LLC
) will finally exit from GAGFAH as it is set to vend the remaining
stake in this Germany-based residential property company. The deal
is expected to close on Jun 13, 2014.
As per the deal, Fortress and its affiliates will offer 60.5
million GAGFAH shares for sale and the total proceeds will stand at
around $986 million. Notably, Fortress has been trimming down its
stake in GAGFAH. Previously, Fortress has offloaded stake in GAGFAH
in Jul 2013 and Dec 2013, with the recent sale in Apr 2014.
Luxembourg-based GAGFAH (Gemeinnützige Aktiengesellschaft für
Angestellten-Heimstätten) is currently one of the major players in
residential real estate market in Germany. GAGFAH was created
through a series of acquisitions in 2004 by Fortress's Private
Given the current strong market position, the latest move by
Fortress will aid GAGFAH to grow independently. On Fortress' part
we believe the move reflects its strategy to book profit by
shedding mature portfolios. Notably, during the life time of GAGFAH
investment, Fortress funds garnered proceeds of $3.8 billion on a
total equity investment of around $2.9 billion.
Further, net proceeds from the transaction can be utilized in the
repayment of debt, making future strategic investments and other
Fortress currently carries a Zacks Rank #3 (Hold). Some better
performing stocks in this space include
Cohen & Steers Inc.
Woori Finance Holdings Co., Ltd.
Ameriprise Financial, Inc.
). Both Cohen & Steers and Woori Finance hold a Zacks Rank #1
(Strong Buy), while Ameriprise carries a Zacks Rank #2 (Buy).
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