Safeguard Scientifics to Expand Investment Focus on Internet
Company Plans to Focus on E-Commerce, Enterprise Applications, and Network Infrastructure
WAYNE, Pa., Jan. 12 /PRNewswire/ -- Safeguard Scientifics, Inc. (NYSE: SFE - news), a developer of rapidly growing information technology businesses, announced today that it will target three technology growth areas for its investments during 1999 -- e-Commerce, enterprise applications, and network infrastructure -- all of which are expected to benefit from growing use of the Internet. This investment strategy builds on Safeguard's current portfolio of high growth IT partnership companies while sharpening its investment focus in order to optimize the deployment of management resources and capital.
The Company plans to balance its new investments across these three target areas during 1999. Consistent with its past approach, Safeguard plans to invest in early to mid-stage companies that can become leaders in their respective markets:
Within the e-Commerce sector, Safeguard will look for companies that are involved in transaction processing which is enabled by the Internet, especially business-to-consumer commerce and enabling technologies such as intelligent searching, tasking and reporting, and content management.
Enterprise applications offer several areas of growth arising from the rapid adoption of Internet applications and new technology systems including data/information/knowledge management and applications integration and implementation.
Network infrastructure refers to the products and services which support, optimize and/or facilitate e-Commerce and enterprise applications businesses. Examples include communications and telecommunications vendors that support Internet access and e-Commerce, network architecture products and services that optimize e-Commerce and enterprise applications investments, and desktop, server, laptop and hand-held devices that facilitate e-Commerce and enterprise applications.
Safeguard is already active in the Internet and e-Commerce markets through its investments in over 10 partnership companies including Internet Capital Group (ICG) and US Interactive. ICG was formed in 1996 by two Safeguard executives to focus exclusively on the investment, operation and management of business-to-business e-Commerce companies. Safeguard's new investment focus will facilitate potential complementary joint investments with ICG. Safeguard holds a 26% ownership interest in ICG. US Interactive is an Internet professional services company that draws on an unique combination of business strategy, marketing and technology disciplines to engineer electronic enterprise solutions. Arista Knowledge Systems, Integrated Visions (the newest spin-out from XL Vision) and Pac-West Telecomm are other private companies in the Safeguard partnership that are leveraging the Internet. Several of Safeguard's publicly-traded partnership companies, including Cambridge Technology Partners, which was recently named the number one Web developer by Forrester Research; Diamond Technology Partners; DocuCorp International; Sanchez Computer Associates; and Who? Vision Systems, which is currently in registration with the SEC, also incorporate the Internet in their product or service offerings.
''We believe this strategy aligns Safeguard's investments with our goal of producing successful rights offerings,'' said Steve Andriole, Safeguard's senior technology officer. ''The three areas we've targeted reflect what we expect buyers of IT products and services will need in the near and long-term future. Therefore, what we have done is defined the flip side of demand as our investment strategy for 1999.''
Commenting on the investment focus for 1999, Pete Musser, chairman and CEO of Safeguard Scientifics, said, ''Safeguard has a successful history of recognizing next generation trends and identifying companies that will exploit those trends. In 1996, we recognized the growing importance of the Internet and sponsored the formation of Internet Capital Group to focus on the Internet. It is now clear that the Internet is becoming a primary means by which suppliers, customers, and employees interact and transact business of all kinds. In addition, we have a proven ability to guide emerging growth companies through the early stages of development in preparation for public ownership by providing a variety of development services and networking opportunities among our partnership companies. With our focus in 1999 on e-Commerce, enterprise applications, and network infrastructure, we will continue to do what we do best -- incubate early to mid-stage technology companies that are expected to grow and create a significant market impact. To that end, we are actively engaged in meaningful discussions with several technology companies to execute on this strategy, and we expect to have more announcements on our progress in the near future.''
About Safeguard
Safeguard Scientifics, Inc. (www.safeguard.com) is a unique partnership of entrepreneurial companies focused on information technology markets. Safeguard has a proven track record of bringing emerging companies to market through rights offerings to Safeguard shareholders. Past Safeguard rights offerings include Novell, Inc., CompuCom Systems, Inc., Cambridge
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