SAFEGUARD SCIENTIFICS ANNOUNCES COMPLETION OF ACQUISITION OF ITS OWNERSHIP INTERESTS IN FLASHTALKING AND COMMENCMENT OF TENDER OFFER TO PURCHASE UP TO $35 MILLION OF ITS COMMON STOCK
September 02 2021 - 7:00AM
Safeguard Scientifics, Inc. (NYSE:SFE) (“Safeguard,” “SFE” or the
“Company”) today announced that the previously announced
acquisition of its ownership interest in Flashtalking was completed
resulting in cash proceeds to Safeguard of approximately $44.8
million. The Company may receive additional amounts of
up to approximately $0.8 million over the next 24 months from the
resolution of escrow contingencies.
Safeguard is also announcing today the commencement of a
modified “Dutch auction” self-tender offer to purchase for cash up
to $35 million in value of shares of its common stock at
a price within (and including) the range
of $7.90 to $9.00 per share. The closing price
of SFE’s common stock on Wednesday September 1, 2021, the last
full trading day prior to the commencement of the tender offer,
was $7.88 per share. SFE intends to finance the tender
offer with cash proceeds from the sale of its ownership interest in
Flashtalking.
“Today’s announcement represents a significant achievement as we
are committed to returning value to Safeguard’s shareholders when
our liquidity exceeds what is needed to operate and support our
portfolio,” said Safeguard CEO Eric C. Salzman. “As we work
closely with our remaining portfolio companies, we will continue to
explore all avenues to maximize value for our shareholders.”
The tender offer will expire at 5:00 pm, Eastern Time,
on Friday, October 1, 2021, unless extended by SFE. Tenders of
SFE’s common stock must be made prior to the expiration of the
tender offer and may be withdrawn at any time prior to the
expiration of the tender offer. The modified “Dutch auction” will
allow shareholders to indicate how many shares and at what price or
prices within SFE’s specified range they wish to tender. Based on
the number of shares tendered and the prices specified by the
tendering shareholders, a determination will be made as to the
lowest price per share within the range that will enable SFE to
purchase up to $35 million of its common stock or a
lesser amount if the offer is not fully subscribed. SFE also
reserves the right to purchase up to an additional 2% of its shares
outstanding pursuant to and without amending or extending the
tender offer.
Certain Information Regarding the
Tender OfferGeorgeson Securities Corporation is
acting as the dealer manager for the tender offer
and Georgeson LLC will serve as information agent. The
depositary is Computershare Trust Company, N.A. For more
information about the tender offer, please contact Georgeson
LLC at (800) 676-0098.
While SFE’s board of directors has authorized the tender offer,
none of SFE, its directors and officers, the dealer manager or the
information agent is making any recommendation to shareholders on
whether or not to tender their shares. Shareholders must make their
own decision as to whether to tender their shares and, if so, how
many shares to tender and the price or prices at which to tender
them. In doing so, shareholders should read carefully the
information in the Offer to Purchase and the Letter of Transmittal
relating to the tender offer that are being distributed to
shareholders and filed with the Securities and Exchange
Commission today. Shareholders are urged to discuss their
decision with their tax advisors, financial advisors and/or
brokers.
This press release is for informational purposes only and is not
an offer to buy or a solicitation of an offer to sell any shares of
SFE’s common stock. The offer is being made solely by the Offer to
Purchase and the related Letter of Transmittal, as they may be
amended or supplemented. Shareholders and investors are urged to
read SFE’s Tender Offer Statement on Schedule TO, which is being
filed with the Securities and Exchange Commission in
connection with the tender offer and includes as exhibits the Offer
to Purchase, the related Letter of Transmittal and other offer
materials, as well as any amendments or supplements to the Schedule
TO when they become available, because they contain important
information. Each of these documents has been or will be filed with
the Securities and Exchange Commission, and investors may
obtain them for free from the Securities and Exchange
Commission at its website (www.sec.gov) or from Georgeson
LLC, the information agent for the tender offer, by telephone
toll-free at (800) 676-0098 or in writing to 1290 Avenue of
the Americas, 9th Floor, New York, NY 10104.
About Safeguard Scientifics Historically,
Safeguard Scientifics has provided capital and relevant expertise
to fuel the growth of technology-driven businesses. Safeguard has a
distinguished track record of fostering innovation and building
market leaders that spans more than six decades. Safeguard is
currently pursuing a focused strategy to value-maximize and
monetize its ownership interests over a multi-year time frame to
drive shareholder value. For more information, please visit
www.safeguard.com.
Forward-Looking
StatementsExcept for the historical information and
discussions contained herein, statements contained in this release
may constitute “forward-looking statements.” Our forward-looking
statements are subject to risks and uncertainties. Forward-looking
statements include, but are not limited to, statements related to
the terms of the tender offer and Safeguard’s ability to complete
the tender offer, statements regarding Safeguard’s ability to
maximize the value of monetization opportunities of its ownership
interests and drive total shareholder returns. Safeguard’s
initiatives taken or contemplated to enhance and unlock value for
all of its shareholders, Safeguard’s efforts to execute on and
implement its strategy to streamline its organizational structure,
reduce its operating costs, pursue monetization opportunities for
ownership interests and maximize the return of value to its
shareholders, Safeguard’s ability to create, unlock, enhance and
maximize shareholder value, the effect of Safeguard’s management
succession plan on driving increased organizational effectiveness
and efficiencies, the ability of the management team to execute
Safeguard’s strategy, the availability of, the timing of, and the
proceeds that may ultimately be derived from the monetization of
ownership interests, Safeguard’s projections regarding the
reduction in its ongoing operating expenses, Safeguard’s
projections regarding annualized operating expenses and expected
severance expenses, monetization opportunities for ownership
interests, and the amount of net proceeds from the monetization of
ownership interests that will enable the return of value to
Safeguard shareholders after satisfying working capital needs and
the timing of such return of value. Such forward-looking statements
are not guarantees of future operational or financial performance
and are based on current expectations that involve a number of
uncertainties, risks and assumptions that are difficult to predict.
Therefore, actual outcomes and/or results may differ materially
from those expressed or implied by such forward-looking statements.
The risks and uncertainties that could cause actual results to
differ materially include, among others, the price and amount of
shares purchased pursuant to the tender offer, the possibility that
conditions to completion of the tender offer are not satisfied, our
ability to make good decisions about the monetization of our
ownership interests for maximum value or at all and the return of
value to our shareholders, our ability to successfully execute on
our strategy to streamline our organizational structure and align
our cost structure to increase shareholder value, whether our
strategy will better position us to focus our resources on the
highest-return opportunities and deliver enhanced shareholder
value, the ongoing support of our existing ownership interests, the
fact that our companies may vary from period to period, challenges
to achieving liquidity from our ownership interests, fluctuations
in the market prices of our publicly traded holdings, if any,
competition, our inability to obtain maximum value for our
ownership interests, our ability to attract and retain qualified
employees, market valuations in sectors in which our ownership
interests operate, our inability to control our ownership
interests, our need to manage our assets to avoid registration
under the Investment Company Act of 1940, risks, disruption, costs
and uncertainty caused by or related to the actions of activist
shareholders, including that if individuals are elected to our
Board with a specific agenda, it may adversely affect our ability
to effectively implement our business strategy and create value for
our shareholders and perceived uncertainties as to our future
direction as a result of potential changes to the composition of
our Board may lead to the perception of a change in the direction
of our business, instability or a lack of continuity that may
adversely affect our business, and risks associated with our
ownership interests, including the fact that most of our ownership
interests have a limited operating history and a history of
operating losses, face intense competition and may never be
profitable, the effect of economic conditions in the business
sectors in which Safeguard’s companies operate, and other
uncertainties described in our filings with the Securities and
Exchange Commission. Many of these factors are beyond the Company’s
ability to predict or control. As a result of these and other
factors, the Company’s past operational and financial performance
should not be relied on as an indication of future performance. For
further details regarding the risks to the tender offer, you should
read our filings with the Securities and Exchange Commission
related to the tender offer, including Schedule TO and the
documents referred to therein. Further information on the above
risk factors and other potential factors that could affect our
future business, operating results and financial condition is
included in the Company’s Annual Report on Form 10-K for the year
ended December 31, 2020 and other periodic filings with the
Securities and Exchange Commission, including risks under the
heading “Risk Factors.” The Company does not assume any obligation
to update any forward-looking statements or other information
contained in this press release.
###
SAFEGUARD CONTACT:
Mark Herndon
Chief Financial Officer
(610) 975-4913
mherndon@safeguard.com
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