Heidrick & Struggles International, Inc. (ticker: HSII, exchange: NASDAQ) News Release - 16-Dec-1999
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Heidrick & Struggles International, Inc. Announces Formation of H&S Capital
CHICAGO--(BUSINESS WIRE)--Dec. 16, 1999--
Separate Entity Will Form Venture Funds To Capitalize on the Company's Access to Start-up Firms
Heidrick & Struggles International, Inc. (Nasdaq:HSII), the world's leading executive search firm, today announced that its board of directors has approved the formation of H&S Capital (HSC), a separate entity that will raise capital to establish venture funds that invest in early stage companies, primarily in the technology sector.
Heidrick & Struggles expects over time to invest up to $25 million of cash in HSC funds, which will be managed by investment professionals with extensive experience in the venture capital environment. It is anticipated that HSC will initially raise capital to build two funds -- HSC I and HSC II -- and that the investors in these funds might include qualified Heidrick & Struggles employees, qualified persons and entities who have relationships with Heidrick & Struggles, professional investors and other qualified investors as deemed appropriate.
"The establishment of H&S Capital is the natural next step for us," said Patrick S. Pittard, President and Chief Executive Officer of Heidrick & Struggles International. "We have contributed significant value to an extraordinary number of start-up companies through the identification and placement of their senior management teams. Our unchallenged leadership position and relationships in the technology arena afford us the opportunity to grow along with these entities. Over a year ago we began a program in which warrants for equity were included in addition to the normal cash fee generated when we conducted search assignments for certain companies, some of which are pre-public technology firms. Today, we have over 200 searches in which the confirmation letters contain a provision for equity. HSC is a logical progression in our plans to participate in the wealth we create for these companies."
In addition to "follow-on" investments in start-up companies for which Heidrick & Struggles has conducted CEO or other top level searches, HSC's managers are expected to identify other appropriate investments that have the potential to generate a significant return on investment for the funds. Details on HSC and its initial funds are expected to be finalized by the second quarter of 2000.
"We believe our investment in H&S Capital represents an excellent vehicle from which both our shareholders and search consultants could benefit," explained Pittard. "Those of our consultants who invest in HSC are demonstrating a long-term commitment to Heidrick & Struggles as we provide an additional wealth creation tool to build their long-term net worth."
About Heidrick & Struggles International
Heidrick & Struggles International is the world's leading executive search firm, specializing in chief executive, board of directors and senior level management assignments. Today, more than 750 Heidrick & Struggles professionals serve a broad range of organizations including Fortune 500 companies, financial institutions, major health care organizations, universities and not-for-profit organizations, leading mid-cap companies, and emerging growth companies from offices in 65 locations throughout North and South America, Europe, the Middle East, Africa and Asia Pacific. For more information about Heidrick & Struggles, visit our web site at www.heidrick.com.
Certain matters discussed in this news release are forward-looking statements that are necessarily dependent upon assumptions, estimates and data that may be incorrect or imprecise, and include known and unknown risks, uncertainties and other important factors that could cause the actual results to differ materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Some of the risks, uncertainties, assumptions and factors that could affect the Company's financial results are included in the Company's recent SEC filings. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. All forward-looking statements in this news release are expressly qualified by these cautionary statements, and the Company expressly disclaims any duty to update such forward-looking statements.
CONTACT: Jennifer Silver, 404/572-0019 (Media)
Lynn McHugh, 312/496-1593 (analysts)