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Tue 24 Mar 2020 05:24 PM

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NMC Health debt now estimated at $6.6bn after latest review

As recently as March 10, the embattled company's debts were estimated at $5bn

NMC Health debt now estimated at $6.6bn after latest review

NMC announced that following a period of extended leave for ill health, Prasanth Shenoy has resigned as chief financial officer with immediate effect. 

Embattled healthcare operator NMC Health’s debt position is currently estimated at $6.6 billion, significantly higher than the approximately $5 billion reported earlier in March, the company said in a statement posted to the London Stock Exchange.

According to the statement, the debt includes a $360 million convertible bond and $400 million sukuk.

On March 10, NMC estimated that its debts stood at about $5 billion. Since then, the company has verified another $0.3 billion currently outstanding that related to facilities the company’s board was aware of in June 2019, as well as $0.8 billion of newly identified facilities and an additional $0.4 billion of facilities entered into post June 20190 and unidentified earlier in March.

“NMC is continuing to work with its advisers to understand the exact nature and quantum of the undisclosed facilities, including the circumstances in which they were obtained,” the statement said.

“The board believes that some of the proceeds may have been utilised for non-group purposes and work is commencing on a project to trace such proceeds with a view to considering what actions may be available to the Group to recover such monies,” the statement added.

Additionally, the board was also informed of the existence of cheques written by group companies that may have been used to benefit third-parties, totalling $50 million.

“The existence of these cheques has only recently been brought to the attention of the board and urgent investigations are ongoing,” the statement added.

The statement also noted that former PwC restructuring partner Matthew J. Wilde has been named as NMC’s chief restructuring office, effective Sunday, March 22.

Resignation

NMC also announced that following a period of extended leave for ill health, Prasanth Shenoy has resigned as chief financial officer with immediate effect. 

In the short term, NMC has appointed a Director of Finance from internal resources and PwC will continue to support the finance function, it said, with a view to making a full time appointment in due course. 

Setback

Earlier in March, NMC was booted from the UK’s benchmark FTSE 100 Index in another setback for the company, which has been in a state of freefall since short seller Muddy Waters Capital LLC accused it of financial improprieties in December.

NMC Health initially labelled as “unfounded, baseless and misleading” the allegations by Muddy Waters that the company had overpaid for assets, inflated cash balances, understated its debt and had corporate governance shortcomings.

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