Internet Capital Group, of Wayne, said today that it will collect around $85 million in gross proceeds from the sale of its stake in Creditex, a New York company that processes credit-default swap trades, to the Atlanta-based Intercontinental Exchange.
The Creditex sale is valued at around $625 million, including ICG's stake, and is subject to changes in Intercontinental's share price and a working-capital adjustment at closing.
Internet Capital paid $25 million for its Creditex stake three years ago, chief executive officer Walter W. Buckley said at an investor conference last month.
Despite the credit crunch that has curbed Wall Street's appetite for complex investments, Buckley said Creditex sales rose sharply last year.
Credit-default swaps are contracts that allow hedge funds and other investors to bet that a company will fail to pay its bondholders.
The sale was Internet Capital's biggest payday since it grossed $150 million in 2005 for selling its stake in LinkShare Corp., an online marketing company, to Raukten Inc., spokeswoman Michelle Musburger said.
Internet Capital shares were up 53 cents a share in Nasdaq trading, to $10.29, with about a half-hour to go before the market closed.
The stock peaked at a split-adjusted $4,000 per share in January 2000 after it was hyped by Merrill Lynch analyst Henry Blodget and other Internet pitchmen, before collapsing to $3.22 two years later. It has traded between $8 and $12 for most of the last three years.