Abraaj says KPMG findings show no misuse of funds

'Unused capital was returned to investors,' says Abraaj in a statement
Arif Naqvi, chief executive of Abraaj Group.
By Shayan Shakeel
Thu 08 Feb 2018 10:41 AM

Dubai-based Abraaj Group, accused of misusing funds from investors including Bill Gates, said KPMG’s audit of receipts and payments from its Health fund show that unused capital was returned to its investors.

KPMG was appointed by the Abraaj Group at the beginning of January, “to verify all payments and receipts made by the [Growth Markets Health] Fund,” Abraaj said in a statement.

“This review was conducted in accordance with the International Standard on Related Services applicable to agreed-upon procedures engagements. This standard is issued by the International Auditing and Assurance Standards Board.”

After completed its findings, KPMG has reported “that all such payments and receipts have been verified, in line with the agreed upon procedures performed, and that unused capital was returned to investors,” Abraaj said in a statement.

Arabian Business has reached out to KPMG for comment.

According to The Wall Street Journal, The Bill and Melinda Gates Foundation, the World Bank’s International Finance Corporation (IFC) unit, CDC Group PLC and Proparco Group have reportedly hired forensic accountants Ankura to look into why their combined $200m investment in the $1bn Abraaj Growth Markets Health Fund (AGHF) had remained unspent – and why, as per the contract, it hadn’t been returned to them. It was alleged, that Abraaj, had been using funds meant for the purchase of hospitals in Pakistan, India and Nigeria for operational expenses.

The Abraaj Group has rejected claims by investors, including the Bill and Melinda Gates Foundation, that it has misused $200 million allocated to the $1bn Growth Markets healthcare fund.

In a written statement on Sunday, Abraaj denied any wrongdoing, saying the reports were “inaccurate and misleading” but did confirm that “some capital was not used as quickly as anticipated due to unforeseen political and regulatory developments in several of the Fund’s operating markets”. The delays, the statement read, “were regularly communicated to investors through quarterly General Partner Reports and other investor communications.”

Founded in 2002 by Arif Naqvi, Dubai-based Abraaj is one of the most influential venture capital vehicles in the developing world with approximately $14 billion under management, and the majority invested in projects in Asia and Africa.

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