Safeguard is looking to expand its platform.
We are focused on augmenting our capabilities as a growth capital provider.
Safeguard's platform expansion initiatives are intended to augment our capabilities as a growth capital provider and to participate in the management of external sources of capital. Not only do these initiatives diversify Safeguard's business platform, but we also believe they will generate solid opportunities for current interest income and future fee income and profit participation for us.
Our Partnership with Penn Mezzanine
Safeguard’s partnership with Penn Mezzanine represents our first platform expansion initiative, which is expected to produce current interest income, as well as future management fee income and profit participation. Led by a team of experienced mezzanine lenders, this platform enables Safeguard to provide flexible financing strategies to current and prospective partner companies, as well as other potential borrowers.
In August 2011, Penn Mezzanine closed its first fund, having raised more than $64 million in the aggregate, including Safeguard’s $30 million. As of March 31, 2012, Penn Mezzanine had deployed an aggregate of $26.4 million in seven companies yielding 12.8%. Safeguard deployed $3.9 million in Penn Mezzanine in August 2011 and has a 36% ownership position. In addition, as of March 31, 2012, Safeguard had deployed a total of $12.2 million in connection with Penn Mezzanine’s lending activities, of which $9.8 million remained outstanding at that date. Interest income for the period related to Penn Mezzanine activities was $0.6 million. Planning is underway for the continued evolution of this vehicle as a long-term activity for Safeguard.
For more information about Penn Mezzanine, visit www.pennmezz.com or Follow the company on Twitter @pennmezz.