More on the Fortress IPO

The debut of Fortress Investment as an IPO was dazzling. But a columnist for TheStreet.com has taken a closer look at the prospectus and finds much to quibble with. He notes that the top principals really cashed out--even before the IPO--withdrawing roughly $850 million plus the $888 million proceeds from the sale of a stake to Nomura. Nothing illegal here, but it is noted. Other gems: The principals will "still own somewhere between 68 percent and 78 percent of the business, in the form of special units in the operating company. When the principals exchange these units...for ordinary shares, Fortress ought to get a tax benefit...But according to the prospectus, whenever an exchange occurs, Fortress Investments has to hand over 85 percent of any tax benefit to the principal. In cash."  Some of this is brow-raising to be sure. But I wonder: Even if all the institutions that bought into the IPO read all this, would it have mattered?

For more:
- here's the column from The Street