Runway Growth Finance set to purchase SWK Holdings in approximately $220 million transaction
Runway Growth Finance Corp. (RWAY) announced that it has entered into a definitive merger agreement to acquire SWK Holdings Corporation (SWKH). Runway Growth's Founder and CEO, David Spreng, said, "This transaction meaningfully advances our strategy to diversify and optimize our portfolio by adding SWK's high-quality investments in the key sectors of healthcare and life sciences. At the same time, we are enhancing our earnings power, more than offsetting the anticipated loan repayments we previously signaled, and we expect to deliver mid-single-digit NII accretion. This transaction reinforces the strength of Runway Growth's portfolio as we work to generate long-term value for our shareholders through disciplined growth and venture debt investing with a focus on excellent credit quality in the sectors we know best. Looking ahead, and with the full support of BC Partners Advisors L.P., we are pursuing growth through both organic and inorganic strategies as a permanent capital vehicle backed by the $10 billion BC Partners Credit platform. We are doing all of this while growing our shareholder base, improving our existing robust portfolio metrics and increasing our total assets to $1.3 billion pro forma with the SWK merger transaction." The transaction will be a net asset value-for-NAV merger and will have an estimated purchase price of approximately $220M, based on SWK's June 30, 2025 reported financials and including estimated SWK transaction expenses. This includes a fixed stock component expected to total $75.5M in Runway Growth shares valued at closing NAV per share and approximately $145M in cash. The cash payment will be based on SWK's final NAV, which will be struck 48 hours prior to closing and reflective of SWK's accumulated retained earnings between June 30, 2025 and close. Additionally, Runway Growth Capital LLC, in its capacity as Runway Growth's external investment adviser, will be contributing $9M in cash for distribution as consideration to the stockholders of SWK separate from and in addition to the consideration described in the first sentence of this paragraph. SWK's portfolio includes 22 companies, with an approximate fair value of $242M based on Runway Growth's estimates conducted as of August 15, 2025. SWK's Board of Directors, which consists of three independent members, has unanimously approved the transaction. Carlson Capital L.P. has signed a Voting Agreement supporting the transaction. The transaction is expected to close in late 2025 or the first quarter of 2026, pending SWK shareholder and regulatory approvals and other customary closing conditions.
