Safeguard Scientifics, Inc. (NYSE:SFE) (“Safeguard” or the
“Company”) today announced the preliminary results of its
previously announced 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 tender offer
expired at 5:00 p.m. Eastern Time on Friday, October 1, 2021.
Based on the preliminary count
by Computershare Trust Company, N.A., the depositary for the
tender offer, a total of 5,035,906 shares of common stock were
properly tendered and not properly withdrawn at or below the
purchase price of $9.00 per share, including 709,375
shares that were tendered by notice of guaranteed delivery.
Because the tender offer was oversubscribed, and
pursuant to the terms of the tender offer, the Company has elected
to purchase 415,938 additional shares (2% of its outstanding shares
of common stock). The relative number of shares of common stock
that will be purchased from each shareholder will be prorated based
on the number of shares of common stock properly tendered, except
for tenders of odd lots, which will be accepted in full.
As a result, in accordance with the terms and
conditions of the tender offer, and based on the preliminary count
by the depositary, Safeguard expects to acquire 4,304,826 shares of
its common stock at a price of $9.00 per share for an
aggregate purchase price of approximately $38.7 million,
excluding fees and expenses related to the tender offer. The shares
of common stock expected to be purchased represent approximately
20.7% of the Company’s shares of common stock issued and
outstanding as of October 1, 2021, which would result in the
Company having 16,491,595 shares issued and outstanding immediately
following such repurchase. The Company will pay for the repurchases
of shares of its common stock with available cash.
The number of shares of common stock to be
purchased is preliminary and subject to change. The preliminary
information contained in this press release is subject to
confirmation by the depositary and is based on the assumption that
all shares of common stock tendered through notice of guaranteed
delivery will be delivered within the two business day settlement
period. The final number of shares to be purchased will be
announced following the expiration of the guaranteed delivery
period and completion by the depositary of the confirmation
process. Payment for the shares accepted for purchase pursuant to
the tender offer will occur promptly thereafter.
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 Safeguard’s common stock. The offer was made
solely by the Offer to Purchase and the related Letter of
Transmittal, as they may be amended or supplemented, that Safeguard
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. Any questions about the tender offer should be
directed to the information agent, Georgeson LLC at (800)
676-0098.
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
Statements Except 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, our
ability to complete the tender offer, the price and amount of
shares purchased pursuant to the tender offer, our ability to
achieve the benefits contemplated by the tender offer, 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 our companies operate, and
other uncertainties described in our filings with the Securities
and Exchange Commission. Many of these factors are beyond our
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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