UAE’s NMC Healthcare hires chief restructuring officer as debt reckoning balloons

By Rebecca Melvin

New York, March 24 – NMC Health plc appointed Matthew J. Wilde as the company’s chief restructuring officer effective March 22 and said the company’s debt level reckoning has ballooned to $6.6 billion as of March 23 from a previous $5 billion estimate made on March 10, according to an update filed with the London Stock Exchange.

The company also announced that chief financial officer Prasanth Shenoy has resigned following extended leave for ill health, and the company has appointed an interim director of finance from internal resources and PwC will continue to support its finance function.

On March 10, the company disclosed that its debt level had risen significantly from its last disclosure June 30, 2019.

A $360 million convertible bond and $400 million sukuk are part of its debt accounting. The company said that since March 10 it has verified a further $300 million currently outstanding related to facilities that were known to the board as of June 2019, $800 million of newly identified facilities, undisclosed as of June 2019 and unknown to the board, and an additional $400 million of facilities entered into post June 2019 and unidentified as of March 10.

The company said it is continuing to work with advisers to understand the exact nature and amount of the undisclosed facilities, including the circumstances in which they were obtained. The board believes that some of the proceeds may have been used for non-group purposes, and it is considering what actions may be available to the group to recover such monies.

Furthermore, the board was informed of the presence of checks written by group companies that may have been used as security for financing arrangements for the benefit of third parties. A preliminary view is that the amount of these checks is about $50 million.

Finally, the company said that it has taken steps since January to ensure the health and safety of the group and the community during the current Covid-19 pandemic. Its health care facilities include an extensive network of long-term care facilities, multi-specialty hospitals and clinics in the Gulf Cooperation Council region.

The NMC said it is safeguarding operational liquidity to continue funding existing operations, at the same time that it grapples with its significant debt increase.

NMC Health operates one of the largest wholesale distribution businesses in the United Arab Emirates, including consumer goods, pharmaceuticals and scientific equipment.

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