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Fortress IPO launch finishes with a bang

By Aaron Siegel

February 12, 2007 12:00 pm ET

Fortress Financial Group LLC, the first hedge fund and private equity firm to go public on a U.S. exchange, saw its stock rise 68% on its first day of trading on Friday, increasing to $35 from an offering price of $18.50.

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It finished and finished the trading day at $31 per share.

The company sold 34.29 million shares, or about 8.6% of the firm's management company.

As a result of the smash debut, the Fortress' five principals Wesley Edens, Peter Briger, Robert Kauffman, Randal Nardone and Michael Novogratz kept 77.7% of the votes in the firm, which is worth approximately $9.7 billion, according to The Wall Street Journal.

The company said it returned 39.7% per year on its private equity funds since 1999 and its hedge funds have brought in 14% a year since 2000.

After Friday's close, Fortress shares traded at roughly 40 times last year's earnings, according to the report.

Fortress had $29.9 billion in assets as of Sept. 2006, up from $1.2 billion in Dec. 2001.

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