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.
The programme is being organised United for a Better Dakshina Kannada', a forum which comprises organisations belonging to different faiths including Ahinda, Buntara Yane Nadavara Mathr Sangha, Catholic Diocese of Mangalore, Dalit Sangharsha Samiti, Al Haq, Hope Foundation, Jain Samiti, Karnataka Christian Educational Society, Karnataka Komu Souharda Vedike, Karnataka Missions Network, KKMA-Karnataka, MFriends, Mogaveera Mahajana Sangha, Muslim Lekhakara Sangha, Sri Guru Singh Sabha Society, Talent Research Foundation and Yuva Vahini.
Comments
Naren....do a candle March for you cow maa first....then bharat maa....ha ha........we will be there in kadri....you will be repeating your bla bla.....sanghi paid goon....shitting in Singapooor.....poor fellow modiji can't help him to find a job here...what a pity in the bmj...chanters....
One Pakistani rant started chanting porkis slogan ...le farooq ....your kashmiri civilians who were killed are jihadis ... They shout anti India slogan ..sorry we dont consider them as indians at slll . they want benefits from India and loyalty to Pakistan ...any person who is born to their fathers will not support kashmiri stone Pelters ...nange doubt nin mele hahaha ..Kashmir belongs to indian nationalist ...bholo bharath mata ki jai ...no of unlikes shows this media is filled with pakis
Uri terror attack should be condemned and the wrong doers should be punished. But this brutal act did not happen all of a sudden. It was part of the two month long violence in Kashmir which killed nearly hundred people and injured thousands of innocent Kashmiris.
When you show solidarity with martyred soldiers, you should not forget the martyred Kashmiri civilians. Only terrorists deserve death. Civilians deserve your solidarity and those who are using pellet guns against innocent civilians deserve punishment.
United for a better Mangaluru now expanded jurisdiction till district borders? Or this is a new forum?
Lets join our hands together to support our armed forces that are protection our nation by sacrifying lives.
Btw, why caostaldigst.com did not cover yesterday's event at the same Kadri War Memorial wherein nationalist leaders paid tributes to the martyrs?
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