Fortress Investment Group, a 10% owner of of Brookdale Senior Living, liquidated a substantial portion of its equity holdings in order to meet its margin calls late last month. According to Brookdale Senior Living’s SEC Filings, Fortress and its affiliates sold over 100 million shares. Their 8-K stated that:
On November 28, 2008, Fortress Investment Group LLC informed Brookdale Senior Living Inc. (the “Company”) as follows: “All amounts borrowed under the loan agreement (the “Loan Agreement”), entered into as of December 28, 2007 by FIT Holdings LLC and FIT-ALT Investor LLC (affiliates of Fortress Investment Group LLC) with Goldman Sachs Bank USA, as agent, Goldman, Sachs & Co., as collateral agent, and the lenders party thereto, have been repaid, and the Loan Agreement has been terminated. As a result, the shares of the Company owned by these affiliates of Fortress Investment Group LLC are no longer pledged under the Loan Agreement.”
The Company was not a party to the Loan Agreement and had no obligations thereunder.
The sale of the stock looks as though as it was triggered when Brookdale’s stock price reached a low of $3.15 per share on November 20th and 21st.Since then, the stock has rebounded slightly but that’s an awful lot of downward pressure on the stock price’s value with a triggered sale of that magnitude.