Docucorp Buys Back Shares Owned by Safeguard Scientifics, Inc.
Press release from the issuing company
DALLAS & WAYNE, Pa.--June 4, 2003-- Docucorp International and Safeguard Scientifics, Inc. today announced that Docucorp has repurchased 3,094,520 shares of its common stock, along with warrants to purchase an additional 161,242 shares of its common stock, from Safeguard Scientifics, Inc. and a former officer of Safeguard in a private transaction. The purchase represents approximately 24 percent of Docucorp's outstanding common stock as of June 2, 2003. The purchase price was $5.95 per share, and the aggregate proceeds including the warrants were $18.7 million. The transaction is expected to be accretive to Docucorp earnings per share in future periods.
Docucorp utilized a combination of bank financing and cash on hand to effect the transaction. The bank financing of approximately $14.2 million bears interest at a fixed rate of 3.3 percent and is repayable in equal monthly installments over four years.
"Safeguard has been a stockholder and a valuable partner of the company for many years. They were instrumental in the formative stages of Docucorp's success, and we appreciate their contributions and ongoing support," said Michael D. Andereck, president and chief executive officer, Docucorp. "This transaction eliminates any uncertainty associated with the large block of stock owned by Safeguard and is expected to be accretive to future Docucorp earnings per share, without reducing the publicly traded float. At the same time, it affords Safeguard, our largest stockholder, the opportunity to obtain liquidity from its long-term investment."
"Since our association with Docucorp in 1997, they have achieved significant revenue and earnings growth," said Anthony L. Craig, president and chief executive officer, Safeguard Scientifics, Inc. "As a result of their success, we now have the opportunity to exit one of our legacy investments and redeploy the proceeds in a way that is more closely aligned with our current business strategy."
With the completion of this transaction, Docucorp has repurchased a total of 9.4 million shares at an average price of $5.37 per share since the inception of its stock repurchase program in 1998.
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