Fortress Investment Group is seeking to raise about $1.5 billion for its latest fund focused on asset-based financing, a key area of expansion for private market firms, according to a Bloomberg report citing people familiar with the matter.
The new fund, named Fortress Asset-Based Credit II, will focus on deals such as lender finance transactions and portfolio acquisitions of consumer and commercial receivables. The fund will also invest in forward flow agreements, under which investors agree to buy loans before they’re originated.
The ABC II will be managed by Fortress Managing Directors Dominick Ruggiero, Matthew Biczak and Ola Eriksson and will target a net return at a range of around 10%-12%. A representative for New York-based Fortress declined to comment to Bloomberg.
The asset-based financing market is on track to reach $1.3 trillion in 2033, up from $682 billion in 2023, according to estimates by consultancy firm ResearchAndMarkets.com. Among Fortress transactions completed last year, the asset manager provided credit facilities to online lenders SoFi Technologies, Inc. (NASDAQ: SOFI) and Best Egg, enabling them to expand their personal loan businesses.
With about $49 billion of assets under management as of the end of September, Fortress invests across strategies ranging from credit, real estate, private equity and permanent capital. The firm’s asset-based credit strategy targets originating businesses primarily in the US and Europe from a broad spectrum of consumer receivables, small commercial receivables and other contractual cash flow streams.
