Fortress Investment Group LLC (FIG.N) is in talks to refinance a $1.6 billion loan to Florida East Coast Industries, in which it owns both equity and debt, the Wall Street Journal reported on Monday.
Fortress has a $2 billion equity investment in Florida East Coast from its purchase of the company in 2007, but separate funds it manages have been buying its debt as well, making them the largest lender with $600 million, the paper reported.
Fortress, a private equity and hedge fund firm with about $26.5 billion under management, bought the the railroad and real estate company in 2007 for about $3.5 billion.
Fortress' position has complicated discussions to refinance the loan but it is expected to reach an agreement, the paper reported, citing unnamed sources. It has until July 27 to do so, it said.
Fortress is not leading negotiations for the lending group, which is being done by Apollo Management, the paper reported. Blackstone Group's (BX.N) GSO Capital Partners and TPG [TPG.UL] also have positions, it said.
A Fortress spokeswoman did not have an immediate comment. (Editing by Valerie Lee)