SuRo Capital Corp. (“SuRo Capital”, the
“Company”, “we”, “us”, and “our”) (Nasdaq:
SSSS) today provided the following preliminary
update on its investment portfolio for the first quarter ended
March 31, 2023. Additionally, the Company reminded its stockholders
its modified “Dutch Auction” tender offer, which commenced on March
21, 2023, remains scheduled to expire at 5:00 P.M., Eastern Time,
on April 17, 2023.
“The challenging task of predicting the path of
the economy, inflation, and changes in Federal Reserve policy,
combined with the recent stress in the banking sector, have led to
continued volatility and confusion in the public equity markets.
With over $124.0 million of investable capital, we remain poised to
continue investing in both primary and secondary opportunities for
later-stage, high-growth companies at what we believe will be
compelling valuations,” said Mark Klein, Chairman and Chief
Executive Officer of SuRo Capital.
Mr. Klein continued, “As we have consistently
demonstrated, SuRo Capital is committed to initiatives that enhance
shareholder value, and we believe the market is currently
undervaluing our portfolio. Accordingly, on March 17, 2023, our
Board of Directors authorized a modified ‘Dutch Auction’ Tender
Offer to purchase up to 3 million shares of our common stock at a
price per share between $3.00 and $4.50. Given our stock is trading
at a significant discount to net asset value, coupled with the
extreme market volatility, we believe the modified ‘Dutch Auction’
Tender Offer to be an efficient and accretive deployment of
capital.”
Mr. Klein concluded, “Based on information
presently available, for the quarter ended March 31, 2023, we
anticipate SuRo Capital’s net asset value to be approximately $7.35
to $7.85 per share.”
As previously reported, SuRo Capital’s net
assets totaled approximately $210.0 million, or $7.39 per share, at
December 31, 2022, and approximately $380.7 million, or $12.22 per
share at March 31, 2022. As of March 31, 2023, SuRo Capital’s net
asset value is estimated to be between $7.35 to $7.85 per
share.
As of March 31, 2023, there were 28,338,580
shares of the Company’s common stock outstanding.
Investment Portfolio Update
As of March 31, 2023, SuRo Capital held
positions in 37 portfolio companies – 33 privately held and 4
publicly held, excluding short-term US treasuries.
During the three months ended March 31, 2023,
SuRo Capital made the following follow-on investments (excluding
short-term US treasuries):
Portfolio Company |
Investment |
Transaction Date |
Amount |
Orchard Technologies,
Inc. |
Series 1 Senior Preferred |
1/13/2023 |
$2.0 million |
|
|
|
|
During the three months ended March 31, 2023,
SuRo Capital exited or received proceeds from the following
investments:
Portfolio Company |
Transaction Date |
Shares Sold |
Average Net Share Price(1) |
NetProceeds |
Realized Loss |
Kahoot! ASA (2) |
Various |
38,305 |
$1.97 |
$0.1 million |
$(0.1 million) |
NewLake Capital Partners,
Inc.(3) |
Various |
123,938 |
$18.50 |
$2.3 million |
$(0.2 million) |
Rent the Runway, Inc.(4) |
1/4/2023 |
79,191 |
$3.05 |
$0.2 million |
$(1.0 million) |
Residential Homes For Rent,
LLC (d/b/a Second Avenue)(5) |
Various |
N/A |
N/A |
$0.3 million |
$- |
__________________(1) The average net share
price is the net share price realized after deducting all
commissions and fees on the sale(s), if
applicable.(2) As of March 8, 2023, SuRo Capital
had sold its remaining Kahoot! ASA public common
shares.(3) As of March 31, 2023, SuRo Capital held
105,820 remaining NewLake Capital Partners, Inc. public common
shares.(4) As of January 4, 2023, SuRo Capital had
sold its remaining Rent the Runway, Inc. public common
shares.(5) During the three months ended March 31,
2023, approximately $0.3 million was received from Residential
Homes For Rent, LLC (d/b/a Second Avenue) related to the 15% term
loan due December 23, 2023. Of the proceeds received, approximately
$0.3 million repaid a portion of the outstanding principal and the
remaining was attributed to interest.
SuRo Capital’s liquid assets were approximately
$135.6 million as of March 31, 2023, consisting of cash, short-term
US treasuries, and securities of publicly traded portfolio
companies not subject to lock-up restrictions at quarter-end.
Modified Dutch Auction Tender
Offer
On March 17, 2023, the Company’s Board of
Directors authorized a modified “Dutch Auction” tender offer (the
“Tender Offer”) to purchase up to 3,000,000 shares of its common
stock at a price per share not less than $3.00 and not greater than
$4.50 in $0.10 increments, using available cash. The Tender Offer
commenced on March 21, 2023 and will expire at 5:00 P.M., Eastern
Time, on April 17, 2023, unless extended. If the Tender Offer is
fully subscribed, the Company will purchase 3,000,000 shares, or
approximately 10.6%, of the Company’s outstanding shares of its
common stock. Any shares tendered may be withdrawn prior to
expiration of the Tender Offer. Stockholders that do not wish to
participate in the Tender Offer do not need to take any action.
Based on the number of shares tendered and the
prices specified by the tendering stockholders, the Company will
determine the lowest per-share price that will enable it to acquire
up to 3,000,000 shares of its common stock. All shares accepted in
the Tender Offer will be purchased at the same price even if
tendered at a lower price.
The Tender Offer is not contingent upon any
minimum number of shares being tendered. The Tender Offer is,
however, subject to other conditions, which are disclosed in the
Tender Offer documents filed with the Company’s Tender Offer
statement on Schedule TO with the U.S. Securities and Exchange
Commission (“SEC”) on March 21, 2023. In the future, the Board of
Directors may consider additional tender offer(s) or other measures
to enhance shareholder value based upon a variety of factors,
including the market price of the Company’s common stock and its
net asset value.
The Company’s Board of Directors is not making
any recommendation to stockholders as to whether to tender or
refrain from tendering their shares into the Tender Offer.
Stockholders must decide how many shares they will tender, if any,
and the price within the stated range at which they will offer
their shares for purchase.
The information agent for the Tender Offer is
D.F. King & Co. Inc., and the depositary is American Stock
Transfer & Trust Company, LLC. The offer to purchase (the
“Offer to Purchase”), a letter of transmittal and related documents
have been mailed to registered holders and certain of our
beneficial holders. Beneficial holders may alternatively receive
the Offer to Purchase and a communication to consult with their
bank, broker or custodian, if they wish to tender shares. For
questions and information, please contact the information agent.
Banks and brokers may call the information agent at (212) 269-5550,
and all others may call the information agent toll-free at (800)
848-3409.
Certain Information Regarding the Tender
Offer
The information in this press release describing
the Company’s Tender Offer is for informational purposes only and
does not constitute an offer to buy or the solicitation of an offer
to sell shares of the Company’s common stock in the Tender Offer.
The Tender Offer is being made only pursuant to the Offer to
Purchase and the related materials that the Company filed with the
Tender Offer statement on Schedule TO with the SEC on March 21,
2023 and has distributed to its stockholders, including as they may
be amended or supplemented. Stockholders should read such Offer to
Purchase and related materials carefully and in their entirety
because they contain important information, including the various
terms and conditions of the Tender Offer. Stockholders of SuRo
Capital Corp. may obtain a free copy of the Tender Offer statement
on Schedule TO, the Offer to Purchase, and other documents that the
Company filed with the SEC on March 21, 2023 from the SEC’s website
at www.sec.gov. Stockholders may also obtain a copy of these
documents, without charge, from D.F. King & Co. Inc., the
information agent for the Tender Offer, by calling toll-free at
(800) 848-3409. Stockholders are urged to carefully read all of
these materials prior to making any decision with respect to the
Tender Offer. Stockholders and investors who have questions or need
assistance may call D.F. King & Co. Inc.
Preliminary Estimates and
Guidance
The preliminary financial estimates provided
herein are unaudited and have been prepared by, and are the
responsibility of, the management of SuRo Capital. Neither our
independent registered public accounting firm, nor any other
independent accountants, have audited, reviewed, compiled, or
performed any procedures with respect to the preliminary financial
data included herein. Actual results may differ materially.
The Company expects to announce its first
quarter ended March 31, 2023 results in May 2023.
Forward-Looking Statements
Statements included herein, including statements
regarding SuRo Capital's beliefs, expectations, intentions, or
strategies for the future, may constitute "forward-looking
statements". SuRo Capital cautions you that forward-looking
statements are not guarantees of future performance and that actual
results or developments may differ materially from those projected
or implied in these statements. All forward-looking statements
involve a number of risks and uncertainties, including the impact
of the COVID-19 pandemic and any market volatility that may be
detrimental to our business, our portfolio companies, our industry,
and the global economy, that could cause actual results to differ
materially from the plans, intentions, and expectations reflected
in or suggested by the forward-looking statements. Risk factors,
cautionary statements, and other conditions which could cause SuRo
Capital's actual results to differ from management's current
expectations are contained in SuRo Capital's filings with the SEC.
SuRo Capital undertakes no obligation to update any forward-looking
statement to reflect events or circumstances that may arise after
the date of this press release.
About SuRo Capital Corp.
SuRo Capital Corp. (Nasdaq: SSSS) is a publicly
traded investment fund that seeks to invest in high-growth,
venture-backed private companies. The fund seeks to create a
portfolio of high-growth emerging private companies via a
repeatable and disciplined investment approach, as well as to
provide investors with access to such companies through its
publicly traded common stock. SuRo Capital is headquartered in New
York, NY and has offices in San Francisco, CA. Connect with the
company on Twitter, LinkedIn, and at www.surocap.com.
ContactSuRo Capital Corp.(212)
931-6331IR@surocap.com
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