Move will allow group to secure additional $325m financing facility, while protecting the business from creditor action
UAE-based NMC Healthcare has been placed in the hands of administrators by the Abu Dhabi Global Markets Courts (ADGM).
Richard Fleming and Ben Cairns of Alvarez & Marsal were appointed joint administrators.
According to a statement, the “light touch” administration process, which relates directly to 36 businesses operating in the UAE, will allow for financial restructuring on “high levels of debt” discovered earlier in the year.
It will also allow the group of entities to secure an additional $325 million financing facility “whilst protecting the businesses from creditor action”, the statement added.
The appointment does not apply to NMC Healthcare’s operating businesses outside of the UAE.
Michael Davis, acting CEO and COO of NMC Healthcare, said, “This is a positive next step in NMC’s restructuring process, allowing us to address the financial challenges we’ve faced since the fraud was uncovered earlier this year.”
All hospitals, medical centres, care facilities and other operations subject to administration will continue to operate as they have been to date.
The performance of NMC’s underlying business continues to be strong and the group has been recognised by the UAE Government for the significant role it has played in the country’s response to the Covid-19 crisis – all of the group’s UAE hospitals are now free of coronavirus patients.
Fleming, who is Managing Director of Alvarez & Marsal, said, “This is a ‘light touch’ administration that will protect NMC from aggressive creditor action whilst bringing new funding and addressing the level of debt in the business.”
The move follows the appointment of Alvarez & Marsal as joint administrators of NMC Health PLC, the holding company of NMC Healthcare, on April 9 this year.
Founded by Indian entrepreneur Bavaguthu Raghuram Shetty, NMC had a market value of $10 billion at its peak on the London Stock Exchange before allegations of fraud pushed it into administration.
The firm has revealed more than $4bn of undisclosed borrowings, giving it a total debt of $6.6bn.
Shetty has said that he is the victim of a fraud that also resulted in the administration of NMC’s sister company, foreign-exchange operator Finablr.
Source: Arabian Business