U T Khader’s health condition improves, to return to work soon

Dubai, Jul 25: The founder of NMC Health, BR Shetty, has had a worldwide freezing order placed on his assets at the request of a lender that claims he has defaulted on a loan of more than $8 million (Dh29.4m).

The order was granted to Credit Europe Bank (Dubai) last month ahead of a claim filed at the DIFC Courts against Mr Shetty, New Medical Centre Trading and NMC Healthcare.

The lender said in its claim they “are jointly and severally liable” for the repayment of money initially secured through a credit agreement in December 2013 and renegotiated in December last year. Credit Europe Bank is an Amsterdam-headquartered institution specialising in trade and commodities finance with operations in nine countries.

The credit agreement was guaranteed by two security cheques which the bank said in its claim were signed by Mr Shetty – one drawn on his personal account and another on the account of New Medical Centre Trading – that have been "dishonoured upon presentation due to insufficient funds".

The bank claimed Mr Shetty “has now fled the jurisdiction of the UAE to India” and that there was a risk of his “substantial” assets in the Emirates being dissipated.

The assets frozen include properties in Abu Dhabi and Dubai, as well as shares in NMC Health, Finablr, BRS Investment Holdings and other companies. It allows for up to $7,000 per week to be spent on “ordinary living expenses and reasonable sum[s] on legal advice and representation”, a DIFC Courts document granting the freezing order shows.

Credit Europe Bank declined to comment when contacted by The National, stating it does not comment on ongoing litigation proceedings. Representatives for Mr Shetty and for NMC Healthcare, which is now being run by administrators Alvarez & Marsal, also declined to comment.

NMC Healthcare was founded by Mr Shetty in 1975 and grew from a single hospital into the UAE’s biggest privately-owned healthcare operator, which employed 2,000 doctors and 20,000 other staff. The company was listed on the London stock exchange and at its peak was valued at £8.58 billion (Dh40bn). However, its shares slumped after short seller Muddy Waters Research issued a report in December 2019 alleging the company had inflated its cash balances, overpaid for assets and understated its debts. This led to a string of damaging revelations by the company, including the fact that its debt was materially higher – at $6.6bn – than the $2.1bn on its balance sheet. NMC Healthcare was placed into administration in April by its biggest creditor, Abu Dhabi Commercial Bank, but its UAE businesses continue to trade as a going concern.

Mr Shetty said in a statement issued in April that he has been a victim of fraud committed by "a small group of current and former executives” at companies owned by him. He said bank accounts were created in his name and transactions were made without his knowledge, and that loans, cheques and bank transfers were also fraudulently guaranteed in his name using his forged signature.

In response to the claim filed by Credit Europe Bank (Dubai) at the DIFC Courts, Mr Shetty says he did not personally guarantee loans made to NMC Trading or NMC Healthcare and that the signatures used on cheques guaranteeing the loans are forgeries. His defence cites the opinion of “Dr Al Bah, an independent, experienced and qualified forensic document examiner”, that someone other than Mr Shetty signed the lending agreements and cheques.

An application by NMC Trading and NMC Healthcare to the DIFC Courts to have the claim against it heard in private for fear of triggering claims by other lenders – the group owes money to around 80 local, regional and international lenders – was dismissed, given that the appointment of administrators at the group and allegations of fraud at the company are already in the public domain.

Both companies have indicated to DIFC Courts that they intend to contest the claim against them.

Bengaluru: Seven fresh Covid 19 positive cases are reported in 24 hours which includes one death from Kalburgi. Of the 7 cases, Kalburgi and Vijayapura share 3 cases each and one case is from Dakshin Kannada, as per the Tuesday mid day health bulletin issued by the Department of Health and Family Welfare.

The deceased has been identified as a 80 year male from Kalburgi. He was bedridden from the past 3 years and was suffering from Parkinson’s Disease since 4 years. Health officials said that he came with the complaint of Severe Acute Respiratory Infection (SARI) and expired on Monday night.

Along with his death, the total death tally now stands at 17 and the total positive cases in the state is 415.

Kalburgi which recorded the first death for Covid 19 in India has so far reported 4 deaths including the above one. The first slot for recording more deaths in the state is now shared by Bangalore urban district and Kalburgi district with each recording 4 deaths each.

Kalburgi district now has 24 active cases.

All the three cases are females, reported from Vijayapura were the primary contacts of a Corona positive patient (P306), who inturn got infected from a patient with history of SARI.

Apart from the deceased male who tested positive, the other cases from Kalburgi is of 29 year old male with influenza like illness and other case is of a 61 year old male whose source of infection is yet to be traced by the health department.

The case from Dakshin Kannada district is from Bantwala region and the positive patient is a 67 year old female with history of SARI. She is getting treated at designated hospital at Dakshin Kannada.

For many Indian tycoons, 2019 turned woeful as lenders -- empowered by the nation’s recent bankruptcy law and desperate to clean up soured debt from their books -- started seizing assets of delinquent firms or dragged them into insolvency.

Indian banks wrote off a record $39 billion of loans in the 18 months through September in a bid to repair their balance sheets as they battled the world’s worst bad debt pile. Making matters worse, a shadow banking crisis led to a funding squeeze, crushing debt-laden businesses that were critically dependent on rollover financing.

“Life has come a full circle for tycoons that had enjoyed debt-fueled growth,” said Nirmal Gangwal, founder of distress and debt restructuring advisory firm Brescon & Allied Partners LLP. “Many firms collapsed like a house of cards. The downfall was rather unprecedented.”
The government has also been cracking down on economic crime to assuage public anger over absconding businessmen. It’s even barred some from traveling overseas if they were deemed a flight risk.

Here are some of the country’s biggest and most-storied businessmen who saw their fortunes fade. Spokespersons for none of these tycoons, except Essar, immediately replied to emails and text messages seeking comments.

Anil Ambani

The chairman of Reliance Group, which makes movies to metro lines, had a close shave with jail time in March before his elder brother and Asia’s richest man, Mukesh Ambani, bailed him out at the last minute. The woes of the ex-billionaire came to the fore when India’s top court asked him to pay Ericsson AB’s India unit about $77 million of past dues or go to jail since Anil Ambani, 60, had given a personal guarantee. His telecom carrier slipped into insolvency this year, while unprofitable Reliance Naval & Engineering Ltd. faced a cash crunch. Reliance Capital Ltd. is selling assets to pare debt. Ambani is also fending off Chinese lenders in a London court.

Malvinder & Shivinder Singh

Karma caught up with ex-billionaires and brothers Malvinder Singh, 47, and Shivinder Singh, 44, and how. Scions of a prominent business family, they once helmed India’s top drug maker and second-largest hospital chain. In October, the two were arrested on charges of fraudulently diverting nearly $337 million from a lender they controlled. India’s market regulator found in 2018 that the brothers had defrauded their hospital company of about $56 million. The collapse of the $2 billion empire turned brother against brother, prompting their mother to broker a peace deal that was short-lived. In February, Malvinder accused Shivinder and their spiritual guru of fraud.

Shashikant & Ravikant Ruia

After a hard-fought battle to keep their flagship steel mill, the first-generation entrepreneurs finally saw the bankrupt Essar Steel India Ltd. pass on to ArcelorMittal last month. The $5.9 billion takeover was almost two years in the making with multiple legal wrangles. The group, controlled by Shashikant Ruia, 76, and Ravikant Ruia, 70, were also reprimanded by a U.K. judge in March this year for concealing documents. Started in 1969 as a construction firm, Essar Group diversified, investing about $18 billion between 2008 and 2012, and piled on debt. In 2017, the group had sold another prized asset, Essar Oil.

Selling an asset to pare a liability shouldn’t be seen as a “lost asset,” an Essar spokesman said, adding that the group remains a diversified conglomerate.

VG Siddhartha

Before jumping off a bridge into a river in July in an apparent suicide, the founder of India’s biggest coffee chain Cafe Coffee Day had penned a letter that spoke of pressure from lenders, a private equity firm and harassment by tax officials. He had spent much of the last two years pledging ever more of Coffee Day Enterprises Ltd. shares to refinance loans for ever shorter periods, at ever higher interest rates. “I would like to say I gave it my all,” V.G. Siddhartha, 60, wrote in the letter. “I fought for a long time but today I gave up.”

Naresh Goyal

The former ticketing agent who built India’s largest airline by value, stepped down as chairman of Jet Airways India Ltd. in March, caving in to pressure from banks who took over the company. Cut-throat price wars and surging costs pushed Jet deeper into loss. The airline stopped flying in April and went into bankruptcy two months later as lenders failed to find a buyer. In July, an Indian court barred Naresh Goyal from flying overseas after the government said it was investigating an alleged $2.6 billion fraud involving Jet Airways.

Rana Kapoor

The founder of Yes Bank Ltd., which became India’s fourth-largest non-state lender, tweeted in September 2018 that his shares were invaluable and requested his children never to sell them upon inheritance. But trouble was brewing. The nation’s banking regulator, which found the lender had repeatedly under-reported its bad loans, refused to extend his tenure as chief executive officer. This forced Rana Kapoor, 62, to step down by end-January. Kapoor, who has pledged some of his Yes Bank shares in July, sold almost his entire stake in the lender by October.

Subhash Chandra

The rice trader-turned-media mogul, 69, who brought cable television into Indian homes in the early 1990s with his ZEE TV, resigned as chairman of Zee Entertainment Enterprises Ltd. in November and lost control of his crown jewel. Subhash Chandra has been selling stake in Zee Entertainment in the past few months to repay group’s debt.

Gautam Thapar

A default by Gautam Thapar, founder of the paper mill-to-power transmission Avantha Group, on pledged shares made Yes Bank Ltd. the biggest shareholder in CG Power and Industrial Solutions Ltd. In August, the firm was hit by an accounting scandal forcing the board to remove Thapar, 59, from the chairman’s post. A month later, the market regulator ordered a forensic audit of the firm and barred Thapar from accessing securities market.