HVIVO

Given the experience of the team at Sterling, we have the skills in-house to value a wide range of businesses. One area we like to invest in is ‘sum-of-the-parts’opportunities – especially if we can invest at a discount before the market wakes up to the embedded value that we have identified.

Such situations can provide a good margin of safety if our assessment of hidden value is accurate. Our holding in hVIVO (previously called Open Orphan) provides a good example. Having followed one of its acquisitions, Venn Life Sciences, for a number of years, we took the decision to invest in hVIVO in May 2020.

In the past, founder Cathal Friel had shared his plans on extracting value from non-core assets via spin-offs and it is a delight when management teams actually deliver on their promises. The successful spin-out of Poolbeg Pharma represented the first step along this journey; in the coming years, we expect more value to be extracted while the core business continues to win sizeable contracts from Pharma majors.

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