If you did any basic reseach on Hercules, what it does, and how it does it, you’ll soon find that Hercules is largely agnostic to what sort of companies it lends to, and in what economic sector those companies operate.
It has a highly diversified loan portfolio, spanning such diverse fields as:
Electronics & Computer Hardware;
Consumer & Business Products;
Diagnostic & Surgical Device Healthcare Services;
Other Sustainable & Renewable Software;
Semiconductors;
Media/Content/Info;
Internet Consumer & Business Services Drug Delivery;
Information Services;
Communications & Networking;
Medical Devices & Equipment Specialty Pharmaceuticals;
Drug Discovery & Development;
Biotechnology Tools
(Refer Slide 37 of Hercules Capital’s most recent investor presentation)
So, based on that, I’m not sure one can conclude that Hercules necessary sees anything that is particularly unique in Mesoblast or in the field of stem cells.
Why, I strongly suspect that there are some contributors to this forum who are more knowledgeable about Mesoblast than the credit analyst at Hercules who prepared the pitchbook that was submitted to Hercules risk committee.
But, judging from Hercules’ fee structure, and the way it charges like a wounded bull, I think what one can safely conclude is that Hercules’ intention in its dealings with Mesoblast - as with all its clients - is most certainly to generate a jolly decent profit.
PS. What Hercules Capital does for a living, namely structured debt, is something that the much-maligned Macquarie Bank also does very successfully. Strange how one structured debt company can be the devil incarnate, and another a deeply-insightful visionary. That irony will be lost on many, I am sure.
MSB Price at posting:
$1.77 Sentiment: None Disclosure: Not Held
(20min delay)