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Tue 10 Mar 2020 08:28 PM

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Debt levels said to soar to $5bn at troubled NMC Health

Debt announcement comes after appointment of Moelis and PwC to support the company in its discussions with lenders and to assist in providing transparency

Debt levels said to soar to $5bn at troubled NMC Health

Troubled healthcare operator NMC Health said on Tueswday that its debt levels have risen over the past six months and are currently estimated at $5 billion.

The announcement comes after UAE-based NMC hired Moelis and PwC to support the company in its discussions with lenders and to assist in providing transparency with respect to its financial position.

The board of NMC said it received an update on its financial position on Tuesday, with work on verifying the debt figure ongoing.

In addition to $2.1 billion group debt reported in June 2019, the company said it has identified over $2.7 billion in facilities that had previously not been disclosed to or approved by the board.

"NMC is continuing to work with its advisers to understand the exact nature and quantum of the undisclosed facilities. The board believes that some proceeds may have been utilised for non-group purposes," a statement said.

NMC said that it is "fully focused on safeguarding its operational liquidity" to continue funding existing operations throughout its various subsidiaries, adding that it recently successfully completed the payment of its February payroll.

The company also reported a strong operating start to the year and has provided services in the months of January and February to over 900,000 outpatients, 24,000 inpatients and 1,700 maternity deliveries in the UAE.

Shares of NMC, founded by Indian billionaire Bavaguthu Raghuram Shetty, have been in freefall since a Muddy Waters report which claimed that that the company had overpaid for assets, inflated cash balances, understated its debt and had corporate governance shortcomings.

The stock was suspended on February 27 and will be relegated to the mid-cap FTSE 250 Index when trading resumes.

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