Abu Dhabi, Feb 17: NMC Health Plc, a hospital operator targeted by short-seller Muddy Waters, said founder Bavaguthu Raghuram Shetty resigned amid investor concern he faced a margin call and misrepresented his stake.
The board asked for Co-Chairman Shetty’s resignation and it takes effect immediately, according to a person with knowledge of the situation. NMC has lost four board members since Friday, including Vice Chairman Khaleefa Butti, whose holdings are also being probed. The stock, the worst performer on the FTSE-100 Index this year, fell as much as 9.2 percent Monday morning and then rebounded.
“The resignation of senior board members should be viewed positively,” said Abdulla Nahlawi, an analyst at Rasmala Investment Bank in Dubai. “The credibility of the current board has been jeopardized with the unfolding of the recent events.”
NMC shares lost almost half their value the first week of February on speculation the company’s main investors faced a margin call, in which banks seize shares pledged as collateral. NMC said Friday that First Abu Dhabi Bank and Al Salam Bank Bahrain obtained 20 million shares in the company from BRS International Holding, an investment vehicle of NMC’s top shareholders. The banks sold more than 8 million of those shares as “enforcement of security,” NMC said.
NMC operates the largest medical network in the United Arab Emirates and in 2012 became the first Abu Dhabi company to list in London. The shares started teetering in mid-December when Muddy Waters alleged that NMC manipulated its balance sheet and inflated the prices of companies it acquired.
Shetty, 77, was born in India and founded NMC in the 1970s after moving to Abu Dhabi. His spokesman said a legal review of the situation is ongoing and declined further comment.
Chief Investment Officer Hani Buttikhi and board member Abdulrahman Basaddiq also stepped down because they were appointees of Shetty and Butti, NMC said, adding that they had no knowledge of the share transfers.
Questions remain over the role of Shetty’s family at the company. His wife and son-in-law both hold roles in senior management.
Almost 10 per cent of NMC’s freely traded shares are shorted, according to Markit Securities data. In mid-December about a third of them were.
Last week GKSD Investment, an investment company backed by hospital investors, said it’s studying a possible offer for NMC. Under U.K. takeover rules, it has until March 9 to make a bid.
NMC has said Muddy Waters’s claims are false and the company hired former FBI Director Louis Freeh to conduct an independent review. The review is due to be completed before the company issues its financial results in March, the person said.
NMC said Mark Tompkins will continue as the company’s sole chairman.
Comments
The actual FACT is during Independence and Partition of India & Pakistan, British as usual left a piece of land so that there will be no peace between India & Pakistan (in-case if they join Hands they will become Super Power of the World). The only solution for Peace to Prevail is leave Kashmir to their people. Let them decide which part of Kashmir they want to stay, make partition, I know this won't be done as for political GAINS, Let the families of Politician start living in Kashmir and feel how it is to lose a loved ones. Just by blaming Pundits and Muslims wont work. Killing innocent people by either side is just to brainwash the Public and to keep the rivalry alive on the basis of religion and country.
Malala , you have yourself experienced how inhuman and ruthlessly atrocious Pakistan Government is. As they manipulated you and your family’s circumstances to harass, they are exploiting and manipulating India’s freeness and all-inclusiveness to keep Kashmir and its denizens in constant turmoil to get pleasure from other’s pain. They are doing same to Baluchistanis since partition and the Kashmiries of Pakistan held area are extremely unhappy and are in totters due to this policy of Pakistan.
Its Pakistan's fault not Indians....Pakistan should stop sending terrorists to India ...which is not happening at all....that is why Kashmiris suffering around there...
Malala should advise Pakistan government first not to involve with our domestic problems....
It is good for Kashmiris if they stay with India as far as their security and economic developments are concerned...
True that Malala has suffered beyond our imagination and came out of it bravely. But that doesn't make her an expert in everything.
Dear Malala, Can you please talk about the inhumanity and heartbreak in Pakistan-occupied Balochistan?
Malala Request you to please stay peaceful and stay happy and not say things that don't fit into ur vocab pls.
I didn't really used to like her but now my respect for her has gone up a lot.
Do you live in delusional world..what should paramilitary forces do if someone is breaking law and order of any country
Lets hope this time her voice will be heard as she has won Noble Prize for PEACE. Lets wish that India will keep Human Life above her EGO and will look Kashmir with HUMAN eye before there is no solution left
Dear Malala, Surely New Delhi government and Kashmiri people need to work together. Your concern is respected.
India in committing a genocide in Kashmir by killing innocent people SC must take notice of this.
As much as I admire Malala, I hate to see her get into Politics and Indo-Pak disputes. There are enough noises being made, or have been made, to no end.
please advise the kids to stop pelting stones and focus on studies to snatch the opportunities from rapidly growing Indian economy.
Thank you Malala for raising your voice in our support.
Since you are an influential opinion maker, I hope the world listen to you and stop the perpetrator from committing these atrocities against us.
Malalaji, Welcome to politics.
Dear Malala we respect you. But it is not government of India or Pakistan decide the future of Kashmir. There are some third parties who really want disturbance or conflict in the valley.
Trolls across the border always loved everything Malala spoke about. I hope they do the same now and accept stark reality!
Thank You Malala, for your kind words and care about Kashmiris
She is a teenage girl with little understanding of the dynamics of terrorism inspite of being a victim of it herself. The valley has been infected by the terror virus with religion which drove away the natural inhabitants of Pandits from Kashmir being hounded from mosque sermons. Many got murdered and not so lucky to escape. No one thought of their rights, now a generation has spent the life as refugee. Neither India nor local Kashmir government or the world body cares to it. However Pakistan terror export looks working well, but it is always the civilian who pays the price.
Add new comment