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01 March 2020

Mubadala weighs investment in BR Shetty’s troubled NMC Health

NMC Health was suspended from trading as the company sought to provide clarity to the market as to its financial position

While discussions are ongoing, there is no guarantee of a transaction given the complex issues facing the company/Shutterstock

by Bloomberg

Abu Dhabi’s Mubadala Investment Company is considering a potential investment in NMC Health—an indication that the emirate is keen to address the worsening crisis at the troubled hospital operator.

Mubadala held early discussions to look at a range of options regarding the Middle East’s largest health care provider, including buying a stake and taking a board seat.

While discussions are ongoing, there is no guarantee of a transaction given the complex issues facing the company. The hospital operator’s troubles began in December 2019 when short-seller Muddy Waters released a report alleging a range of irregularities at the business.

NMC Health commissioned an independent review in January 2020, led by former FBI Director Louis Freeh. Interim findings given to the board revealed more financial liabilities, and the company fired its Chief Executive Officer Prasanth Manghat last week.

Aside from Mubadala, investors linked to Italian hospital operator Gruppo Ospedaliero San Donato have said they’re studying a possible offer for the company and are working with financial advisers. However, KKR & Co has said it’s not making an offer for the business after NMC Health said that it received an approach from the buyout firm.

NMC was founded by Indian entrepreneur Bavaguthu Raghuram Shetty in 1975. Before the Muddy Waters report, NMC’s shares, part of the FTSE 100 Index, had risen more than 12-fold since listing in London eight years ago. They peaked in 2018 after joining a select group of companies in the Arab world worth more than $10 billion.


RELATED STORIES: Mubadala Investment Company Muddy Waters NMC Health Bavaguthu Raghuram Shetty





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