Innolog Holdings (INHC) Keeps Compelling Company. Here's Why Investors Should Care.

Feb 4, 2013 10:54:55 AM PST | 119 View(s) | No Comment(s) - Post a Comment Rating

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Most of the time, the big news an investor hears about a particular company is crammed down their throat by the media. Other times, however, the big news is subtle - almost unrecognizable. It's a subtle detail rather than blatant, screaming news for Innolog Holdings Corporation (PINK:INHC) that may well make the stock something worth a closer look.

Innolog Holdings is, broadly speaking, a government contractor. To date it's provided several support services for multiple military bases. Yet, there's an interesting change of pace with one of the company's recent financial backers that suggests INHC may not be a mere military support contractor any longer.

Few investors have likely heard of Glen Hill Investments LLC. Even fewer have likely heard of Dr. Harry R Jacobson (MD). To the few who have heard of either, though, they know their involvement in a company bodes well - neither bothers with something that isn't poised for, or capable of, success.

While it would be a stretch to say Dr. Harry R Jacobson IS Glen Hill Investments, it wouldn't go too far to say the two entities are tightly linked; Jacobson is the registered agent for Glen Hill, and helps to direct its activities.

Perhaps more important to investors, Dr. Jacobson has founded or co-founded ten companies. One of them was Renal Care Group - a dialysis service provider that went on top be acquired by Fresenius. Another was Act! Software, which was later bought out by Symantec. Jacobson has also incubated CeloNova Biosciences (a medical device outfit) and Ambulatory Services of America (which provides dialysis and radiation-oncology services). Oh, he also just happens to be the Vice Chancellor of Health Affairs, Emeritus, for Vanderbilt University... a post he's held since June 2009. He's also the Chairman of the Board or a Director for a dozen or so companies, including MedSolutions, digiChart, HealthGate Data, Seno Medical Instruments, Ingram Industries, and several more organizations.

In other words, the guy knows everyone, is apparently liked by everyone, and knows how to get a company off the ground.

Great, but what's that got to do with Innolog Holdings Corporation? If you look closely at a recent 10Q filing, you'll see that Glen Hill Investments LLC - the investment company run by Dr. Jacobson - has loaned INHC a sum total of $1.75 million via convertible notes.

Yes, Innolog has lots of lenders, but none as big or with the stature of Glen Hill and Harry R Jacobson.

It all begs one question: What's a gentlemen who's built a fortune (and several companies) within the healthcare sector doing with a hand in the government contracting business?

To answer the question at this time would be pure speculation. Perhaps Dr. Jacobson likes the same things the Small Cap Network liked back in mid-November... rising revenue, and a march towards profitability. It's still uncharacteristic though, unless he's aware of something that the rest of the market isn't aware of yet. Could Innolog Holdings somehow be on the verge of getting into the healthcare arena? It's an idea that jives, given Glen Hill's and Dr. Jacobson's history.

As was said, jumping to that conclusion is pure speculation, and not necessarily a sound investment thesis. On the other hand, there's no denying that Jacobson's involvement is a strong, tacit endorsement of the company, even if a 10Q filing had to be scoured to find it.

James E. Brumley is a paid contributor of the SmallCap Network. James E. Brumley's personal holdings should be disclosed above. You can also view SmallCap Network's complete disclaimer and disclosure.