WAYNE, Pa.--(BUSINESS WIRE)--Safeguard Scientifics, Inc. (NYSE: SFE), a holding company that builds value in growth-stage life sciences and technology companies, today announced that it expects its aggregate cash proceeds from the completed sale of technology partner company Portico Systems to McKesson will be $38.1 million, of which $32.8 million has been received, $1.9 million will be contingent upon performance milestones and $3.4 million will be held in escrow. This represents a 4x cash-on-cash return for Safeguard. Safeguard also received all amounts owed under its $5.0 million mezzanine debt facility with Portico.
McKesson paid $90 million, in cash, for Portico, of which $5 million is contingent upon the achievement of performance milestones. Since August 2006, Safeguard had deployed $9.3 million of equity and $5.0 million of debt.
“Since Safeguard’s initial capital deployment in Portico, the company has emerged as a leading provider of software solutions that empower health plans to transform the performance of their provider networks and significantly reduce their administrative expenses,” said Peter J. Boni, President and CEO of Safeguard Scientifics. “This $90 million acquisition by a top-tier, multinational corporation is evidence that Portico is a high-value, high-growth company. We congratulate the Portico team on their successes and wish them all the best in this next chapter of evolution.”
About Safeguard Scientifics
Founded in 1953 and based in Wayne, PA, Safeguard Scientifics, Inc. (NYSE: SFE) provides growth capital for entrepreneurial and innovative life sciences and technology companies. Safeguard targets life sciences companies in Molecular and Point-of-Care Diagnostics, Medical Devices, Regenerative Medicine, Specialty Pharmaceuticals and selected healthcare services, and technology companies in Internet / New Media, Financial Services IT, Healthcare IT and selected business services with capital requirements of up to $25 million. Safeguard participates in expansion financings, corporate spin-outs, management buyouts, recapitalizations, industry consolidations and early-stage financings. For more information, please visit our website at www.safeguard.com, our blog at blog.safeguard.com or you can follow us on Twitter at twitter.safeguard.com or on LinkedIn at linkedin.safeguard.com.
Forward-looking Statements
Except for the historical information and discussions contained herein, statements contained in this release may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Our forward-looking statements are subject to risks and uncertainties. The risks and uncertainties that could cause actual results to differ materially, include, among others, managing rapidly changing technologies, limited access to capital, competition, the ability to attract and retain qualified employees, the ability to execute our strategy, the uncertainty of the future performance of our companies, acquisitions and dispositions of companies, the inability to manage growth, compliance with government regulations and legal liabilities, additional financing requirements, the effect of economic conditions in the business sectors in which our companies operate, and other uncertainties described in the Company's filings with the Securities and Exchange Commission. Many of these factors are beyond our ability to predict or control. In addition, as a result of these and other factors, our past financial performance should not be relied on as an indication of future performance. The Company does not assume any obligation to update any forward-looking statements or other information contained in this news release.