"Hercules Capital ( NYSE listed) are very savvy investors and custodians of capital. They are publicly listed on the NYSE and have shareholders which they are accountable to. With this in mind and understanding that they are not shareholders, the degree , intensity and magnitude of their Due Diligence BEFORE agreeing to advance US$75m ... IMO will leave for dead any DD conducted by a Pharma. The fact that they are lending $75M to MSB ( unsecured) .... "
So this debt is not secured, you reckon, not even against the market value of MSB's equity?
So when Hercules lends out money to its corporate clients on this totally unsecured basis, what happens if those creditors to Hercules default on the debt?
Do you mean to suggest that Hercules simply writes off the loans?
Boy, not sure how smart that sort of risk management is, and how the shareholders of Hercules feel about their company doing business on that high-risk basis.
Or, maybe Hercules in other cases always makes sure it has some security to back its loan book, but that MSB is the sole exception because it is simply such an irresistible account to secure?
MSB Price at posting:
$1.79 Sentiment: None Disclosure: Not Held
(20min delay)