* Fortress plans to raise $125 million through share sale

* Fortress principals are expected to buy 10 pct (Adds details and background)

NEW YORK, May 13 (Reuters) - Fortress Investment Group (FIG.N: Quote, Profile, Research), one of only a handful of publicly traded hedge fund firms, said on Wednesday that it plans to raise $125 million through a share offering and that its principals will likely buy 10 percent.

The New York-based company, which manages $26.5 billion in assets, said it will offer Class A shares to the public and use the proceeds to pay down certain debt.

Fortress named Citi, J.P. Morgan Securities Inc., Merrill Lynch & Co. and Nomura Securities International, Inc. as joint book-running managers and said it plans to grant the underwriters an option to purchase up to an additional $18.75 million of Class A shares to cover over-allotments.

The company's principals are not expected to sell any shares in connection with the offering but buy 10 percent of the shares that are sold.

Fortress reported earlier in May that clients pulled out $2.65 billion in assets and that it will take over $2 billion of hedge fund firm DB Zwirn & Co's assets. (Reporting by Svea Herbst-Bayliss; Editing Bernard Orr)