Safeguard Scientifics Announces Zipnosis Exit
April 12 2021 - 6:28PM
Safeguard Scientifics, Inc. (NYSE:SFE) (“Safeguard” or the
“Company”) today announced the exit of our ownership interest in
Zipnosis. Safeguard received $3.3 million of initial cash
proceeds and a preferred equity interest in Bright Health Group, a
national integrated healthcare company (“Bright Health”). The
majority of the consideration we received in the transaction is
reflected in this preferred equity interest. Additional cash
proceeds may be received from the final determinations of net
working capital and the resolution of various escrow
contingencies. Safeguard will report a gain on the sale of
the Zipnosis ownership interest for the quarter ended March 31,
2021, based on the total value received from the transaction.
“We are excited about this transaction and the prospects for
Safeguard of being a Bright Health shareholder. We also want
to congratulate Zipnosis’ Founder and CEO, Jon Pearce, and all of
the Zipnosis employees on achieving this milestone. We wish
them the best of luck as part of the Bright Health team,” commented
Safeguard CEO Eric Salzman.
Safeguard deployed an aggregate of $10.0 million to Zipnosis
beginning in December 2015.
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.
About Bright Health GroupBright Health Group is
building the national, integrated healthcare system of the future
by integrating financing, care delivery services and technology to
create a better performing healthcare experience for physicians and
consumers. As a national integrated healthcare platform, we offer
diversified health products and managed care services to over
500,000 consumers in 14 states and more than 50 markets. By
aligning with our Care Partners, we provide consumers access to
personalized care teams tailored to their individual needs. We
deliver high quality virtual and in-person clinical care to over
220,000 patients through our approximately 40 managed and
affiliated advanced risk-bearing primary care clinics. We give
providers the tools they need to optimize their practices and
deliver valued-based care to the patients they serve. Driving it
all is our person-centric, intelligent technology platform which
connects consumers, payers and providers with the common purpose of
lowering healthcare costs while improving outcomes, experience and
access. We are making healthcare right. Together. Learn more
at www.brighthealthgroup.com.
Forward-looking StatementsExcept 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. Forward-looking
statements include, but are not limited to, 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 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. 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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