In the latest developments at NMC Health, group medical director Dr. CR Shetty, the wife of the UAE-based healthcare company’s founder BR Shetty, has resigned from her position. She was the first medical doctor at the group, having joined in the year 1975 when the very first medical center opened. Dr. Shetty rose through the ranks towards becoming the group medical director at NMC Health and the director of hospitals at the subsidiary entity NMC Healthcare which is based in the UAE.
According to the chief executive at NMC Health, Michael Davis, Dr. Chandrakumari Raghuram Shetty emphasized the best clinical care delivery to all patients during her tenure as the medical director, something that NMC continues focusing on in spite of its numerous challenges this year. Prior to resigning from her position, she was also chairing numerous committees including infection control, governance, quality, and facility management along with patient rights. Ms. Shetty, who was in India for a major part of 2020 with her husband, was not involved in the financial activities of the Group according to Davis. He also confirmed that she did not have any active role from March onwards. There has been no official response from Ms. Shetty as of yet, who is already into her early seventies.
One of her aides in Abu Dhabi has confirmed a recent knee surgery that she is recovering from at present. NMC Health was put under administration this April post several torrid months starting from December 2019 when Muddy Waters, the USA-based investor activist, alleged inflation of cash balances. The company was also accused of understating its overall debts. This spurred the appointment of several external investigation agencies including an entity spearheaded by Louis Freeh, ex-director at the US Federal Bureau of Investigations (FBI).
Investigations unearthed total debts of approximately Dh24.2 billion or $6.6 billion at NMC Health which were higher than the declaration of $1.2 billion in official company accounts. Suspected fraudulent behavior at the entity was also highlighted by investigators. A hearing was called for the appointment of administrators for NMC Healthcare and 30+ associated entities.
New administrators appointed for NMC Healthcare
UAE-based NMC Healthcare has now witnessed the appointment of a new administrator in the form of noted restructuring consultancy Alvarez & Marsal. The company has confirmed its appointment of several operating businesses linked to NMC Healthcare courtesy the Abu Dhabi Global Market Courts. The administrators have chalked out a turnaround strategy covering 3 years with Davis including putting operations in the UAE directly into administration for keeping creditor claims at bay while raising $300 million in extra funding from lenders for enabling the Oman and UAE operations to keep operating as well.
The joint administrators of the company will now be Ben Cairns and Richard Fleming at Alvarez & Marsal and their job will be to tackle the high debt levels for the healthcare business. The holding company of the group which is listed in London and named NMC Health Plc, is already being operated by Alvarez & Marsal post being placed in administration back in April 2020. The restructuring and turnaround specialist has stated that this appointment covers 36 operating entities in the UAE although it was not applicable for entities outside the country. This will also enable the securing of $325 million in much-needed funds while safeguarding the company from action by creditors.
The administrators will be spearheading NMC Healthcare’s financial turnaround and restructuring while the current management team will retain operational control for day to day clinical and medical activities. NMC Health is the UAE’s biggest private healthcare company, operating 200+ facilities covering pharmacies, hospitals, and clinics alike. After allegations of fraud and disclosures of a whopping $4 billion leaving the UAE in the form of hidden debt, NMC Healthcare has been at the center of a legal storm. Several global lenders have also been impacted with sizable losses, leading to a series of legal battles for recovering their money from the beleaguered healthcare provider.
