Monday 02, July 2018 by Kudakwashe

Six vie to manage $1 billion Abraaj healthcare fund

 

Colony Capital, TPG and Cerberus Capital Management are among at least six firms in the running to run Abraaj's $1 billion healthcare fund

  

Deloitte, the provisional liquidators of Abraaj, and investors in its healthcare funds are weighing these inquiries, which could pave the way for the healthcare fund to separate from the rest of Abraaj, reported Reuters.

A dispute erupted between Abraaj with four investors including the Bill & Melinda Gates Foundation and the International Finance Corp over the alleged improper use of funds in Abraaj’s healthcare fund.

This triggered months of turmoil at the Middle East and North Africa's biggest buyout fund, which halted its fund-raising activities and shook up its management as it tackled ensuing debt repayment problems.

Abraaj, which has denied misusing the funds, reiterated in a statement that it is working closely and collaboratively with its investors to ensure that the work of the healthcare fund can continue uninterrupted, according to Reuters.

The fund had used 44 per cent of its capital for investments with a focus on developing healthcare systems across Africa and South Asia and has made a total of nine investments that included 25 operating hospitals, 17 clinics and 32 diagnostic centres covering 1.9 million patients, Reuters reports.

The row, which began as early as October last year but only became public months later, revolved around why Abraaj did not invest part of the $1 billion healthcare fund in hospitals and clinics, despite drawing on it.

Following talks with investors, Abraaj returned the unused capital to them at the end of December.

A summary report for creditors prepared by Deloitte said on 4 June said there was no evidence of embezzlement or misappropriation, but highlighted a lack of adequate governance and overall weakness at Abraaj, according to Reuters.

  

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