Fortress Investments, the New York Stock Exchange-listed private equity and hedge fund manager, is the latest alternative asset manager to have make swingeing job cuts, according to a report in The Wall Street Journal.
A source close to the firm said it sacked 11 percent of its 900-strong staff during the fourth quarter of 2008. Some Fortress offices outside the US have been reduced by up to 25 percent, said the report.
In December last year, de-listing became a very real possibility for the group, as its share price dipped beneath the dollar mark for the first time since its listing in February 2007. Regulatory rules for NYSE hold that stocks which trade at below $1 for 30 consecutive days must delist.
Like most financial services stocks, Fortress’ share price has suffered in the turmoil of the recession. Its stock initially soared after the firm went public, rising from its $18 issue price to range between $26 and $30 per share. Its shares began to dive in the fall of 2007, when its third quarter earnings report showed a $38 million net loss. At press time, it was trading at $1.84.
Many global private equity firms began cutting jobs towards the end of 2008, including The Carlyle Group, The Blackstone Group, 3i, Cognetas and American Capital. More recently, it emerged that Dubai’s Istithmar Capital had cut 10 percent of its workforce, while New York-based Cerberus Capital Management plans to do the same.
Fortress was unavailable for comment at press time.