Health Care

UAE's NMC gets takeover approaches, chairman suspended from board discussions

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Private equity firm KKR KKR.N on Tuesday said it does not intend to make an offer for troubled NMC Health NMC.L but Italian-backed GKSD Investment Holding confirmed it could bid. The company is asking its main shareholders for clarity on whether they have pledged any of their holdings as collateral, amid speculation in the market they may have faced a margin call.

Finablr shares, also hit by the Muddy Waters allegations against NMC, were up 7.7% at 77.05 pence. The health care company is conducting an independent review after the hedge fund alleged that the company manipulated its balance sheet and inflated the prices of assets it purchased.

"Today's freakish disclosures about even more pledges and debt validate that the cockroach theory is alive and well - what we found is likely just the tip of the iceberg", Muddy Waters' Carson Block said in a statement.

This suggests that the holdings and interests of Dr Shetty, Al Qebaisi and Al Muhairi have been incorrectly reported historically to the company and the market, the statement said.

Dr Shetty and Al Muhairi have informed the company that they remain supportive and long-term investors in the company.

Shetty stepped down as NMC's chief executive in 2017 but remains one of the largest shareholders, with a 15% stake.

More news: Mel Tucker leaving CU after one season to coach at Michigan State

NMC Health had on Monday said it had received two preliminary approaches from private equity firms. There can be no certainty that any offer will be made for the Company, nor as to the terms on which any offer might be made.

NMC Health shares took a hit back in December, when U.S. short selling firm Muddy Waters accused NMC Health of manipulating its balance sheet to understate debt, which the company firmly denied. KKR declined to comment, while GK could not be reached.

Reuters reported https://www.reuters.com/article/us-nmc-health-m-a-exclusive/exclusive-two-groups-one-backed-by-chinas-fosun-bid-for-nmc-health-stake-sources-idUSKCN1VB20R previous year that NMC was also the target of two groups, one backed by China's Fosun, looking to buy a 40% stake in it. The company has said the allegations are false and misleading.

NMC's margins are "too good to be true" relative to peers, Muddy Waters, which is shorting the company's stock, also said.

A native of India, Shetty moved to Abu Dhabi in 1973 and founded NMC in the 1970s.

Shares in the United Arab Emirates' largest private healthcare company extended losses to touch session lows after the KKR announcement.

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