Capital Available

Posted by | December 10, 2010

In this morning’s Wall Street Journal, Justin Lahart wrote an article titled “Companies Cling to Cash.” Justin reports that there is an increasing number of companies throughout the U.S. that are holding onto substantially more cash than they have in recent years. This is not surprising given the number of initiatives which have been spawned over the last 24 months to increase efficiencies and profits. The real question is, “When will such capital be deployed?”

Generally, executives seem to be hesitant to invest in new initiatives or capabilities until there is a clearer sense of the future direction and pace of economic growth. Some companies have been considering returning capital back to their shareholders in the form of stock buybacks or dividends. Others have earmarked this excess cash for strategic growth initiatives.

At Safeguard Scientifics, we are seeing a steady influx of opportunities to provide growth capital to life sciences and technology companies with experienced management teams, rational business models, and a fair valuation expectation. We continue to select those opportunities which will provide the returns our shareholders expect within a reasonable time period.

With the improvement of our balance sheet strength over the last 90 days, we are actively seeking ways to further develop exciting companies with truly innovative offerings.

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