UAE’s First Abu Dhabi Bank sells 2.5 million shares held by NMC’s BR Shetty

UAE’s First Abu Dhabi Bank has sold its stake of 2.5 million shares in Abu Dhabi-based healthcare conglomerate NMC that belonged to its founder Bavaguthu Raghuram Shetty, reported The National on Saturday.

NMC has said that it was notified of the sale by advisors to Shetty.

Read: Hospital operator NMC Health asks lenders for leniency

The advisors added almost 4.8 million shares which belonged to Shetty were held in a nominee account in Falcon Private Bank and were then transferred to First Abu Dhabi Bank on February 5.

Of these, 2.5 million shares were sold by First Abu Dhabi Bank.

NMC, the UAE’s largest healthcare provider, is reportedly seeking a standstill on $2 billion (Dh7.34bn) of debt.

Read: NMC Health hires Moelis for debt restructuring – reuters

On March 2, NMC asked lenders for an informal standstill on its debt agreements as it tried to safeguard enough cash to keep running. The company said it hired investment bank Moelis & Co., consultant PwC and the law firm Allen & Overy.

Moelis will help NMC in discussions with lenders while PwC will assist with liquidity management, it said.

Read: Italian investor seeks partner to bid for troubled NMC Health

“Dr BR Shetty and his advisers are investigating the details and legal basis of these transactions and the status of the remaining shares as part of the ongoing legal review,” the healthcare firm reportedly said in a statement to the London Stock Exchange, where its share trade.

On February 17, NMC Health which was targeted by short-seller Muddy Waters, said that its founder BR Shetty resigned amid investor concern he faced a margin call and misrepresented his stake.

Read: Billionaire BR Shetty resigns from Abu Dhabi’s ailing NMC Health

Shetty stepped down along with chief investment officer Hani Buttikhi and board member Abdulrahman Basaddiq. A few days later, CEO Prasanth Manghat was dismissed too.

Read: NMC Health cut from FTSE 100 index after Muddy Waters criticism

NMC shares have slumped around 64 per cent in a little more than two months after Muddy Waters’ report alleged in December the company manipulated its balance sheet and inflated the prices of assets it purchased, and was on Thursday cut from the FTSE 100 index.

NMC has said Muddy Waters’s claims are false and that it had hired former FBI Director Louis Freeh to conduct an independent review.

Read: NMC founder Shetty weighs sale of pharma business

On Wednesday, a report on Bloomberg reported that Shetty is considering selling his Abu Dhabi-based pharmaceuticals business, Neopharma, after drawing interest from potential investors, and that it could be valued at between $700m and $1bn.