Administrators of NMC Health have started selling off assets of the troubled Middle Eastern hospital operator as they seek funds to pay back creditors. Administrators are planning to start a sale process for NMC’s lucrative fertility business as soon as June or July. They are considering eventually selling most of the company’s assets, potentially including the flagship hospital business, which is the biggest private health-care provider in the Middle East.
NMC Health is at the centre of a multi-billion dollar fraud investigation, but its chief financial officer (CFO) Suresh Krishnamoorthy has left the UAE and returned to India. Krishnamoorthy stepped down as CFO in 2017 when Prasanth Manghat took over as the NMC CEO, but was reinstated in February this year when the company's financial troubles came to light. Abu Dhabi Commercial Bank (ADCB), which has $981 million worth of exposure in the healthcare provider, successfully applied to UK courts to have the company placed into administration and NMC has subsequently been removed from the London Stock Exchange.
According to hospital operator NMC Health and its Executive Chairman Faisal Belhoul, getting placed in administration by a UK court order would be the "worst-case scenario" for the company’s future. The threat of coming under administration is a live one after Abu Dhabi Commercial Bank had filed a request with a UK court for NMC to be placed under a joint administration. ADCB – which has an exposure of Dh3.6 billion to NMC and affiliates - filed its request in a UK court because NMC Health is listed on London Stock Exchange. According to Belhoul, international institutional investors are keen to take an exposure in NMC despite its current predicament.
Richard Fleming, Mark Firmin and Ben Cairns of Alvarez & Marsal Europe have been appointed joint administrators of Abu Dhabi-based NMC Health. In February the company uncovered $335m (£258m) in previously undisclosed loans to related parties, and a further investigation by PwC unearthed over $2.7bn (£2bn) in undisclosed debt. The administrators have replaced the NMC board, stating that an immediate priority is to implement corporate governance changes in the group. In February, the Financial Conduct Authority launched an investigation into NMC's activities after the company's shares were suspended from trading on the London Stock Exchange.
NMC Health's biggest creditors have set up a coordinating committee, taking a major step toward restructuring the $6.6 billion debt of the hospital operator. The company asked Abu Dhabi Commercial Bank (ADCB) to chair a coordinating committee of debtholders. Deloitte and Clifford Chance have been appointed to advise the committee while Lazard will work with its chair. Abu Dhabi Islamic Bank, Dubai Islamic Bank, Barclays and Standard Chartered will join Abu Dhabi Commercial Bank to form an initial steering group that will lead talks with NMC. NMC is being run by administrators Alvarez & Marsal after succumbing to creditor demands. NMC Health was suspended in February amid allegations of fraud. It has revealed more than $4 billion of undisclosed borrowings, pushing its total debt to $6.6 billion.
The administrators of troubled hospital operator NMC Health have announced a new board of directors. Previous board members, including executive chairman Faisal Belhoul have been removed. The move came after London's High Court on Thursday placed NMC Health into administration, on the application of one of its biggest lenders, Abu Dhabi Commercial Bank (ADCB). Michael Brenden Davis remains as interim chief executive officer and chief operating officer, but does not sit on the company's board.
Oman's Taageer Finance and Sohar International Bank disclosed they have exposures to NMC Health. Taageer has a 1.23 million rial (Dh11.72m) exposure to NMC, while Sohar International Banke's exposure stays at 3.45m rials. Last week NMC was placed in administration by a UK court on the application of one of its biggest lenders, Abu Dhabi Commercial Bank. The joint administrators from turnaround advisory firm Alvarez & Marsal will take immediate control of NMC Health and will work on behalf of all stakeholders. In February, the UK’s Financial Conduct Authority launched an investigation into NMC's activities after the company's shares were suspended from trading on the London Stock Exchange.
Healthcare company NMC Health failed to reach agreement with its creditors. Its major lender, Abu Dhabi Commercial Bank (ADCB) has filed an application in the UK's High Court requesting the company be placed into administration. ADCB’s exposure to NMC amounts to around $981m. US short seller Muddy Waters raised questions about the company’s true level of debt in December. In February the stock was suspended after the investigation turned up inconsistencies in its finances and the UK’s Financial Conduct Authority opened an investigation into the business.
The crisis surrounding NMC Health widened, as the struggling hospital operator rejected a call to be put into administration and United Arab Emirates’ banks disclosed more than $2 billion of exposure. The next chapter opens Thursday when a U.K. court is scheduled to hear Abu Dhabi Commercial Bank PJSC’s bid to place NMC into the hands of administrators. With a market value of $2.4 billion and total debt of $6.6 billion, NMC now faces an investigation by the U.K.’s Financial Conduct Authority.