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NMC, creditors reach restructuring deal

Dubai - The largest private healthcare provider in the UAE ran into trouble last year after the disclosure of more than $4 billion in hidden debt.

Published: Tue 8 Jun 2021, 4:40 PM

Updated: Tue 8 Jun 2021, 4:41 PM

  • By
  • Waheed Abbas

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Wam file photo

Wam file photo

Healthcare provider NMC has reached a restructuring deal with creditors that will allow lender to take control the UAE firm.

A statement issued by the healthcare group said the agreement will also ensure the exit of company from Abu Dhabi Global Market (ADGM) administration.

NMC, the largest private healthcare provider in the UAE, ran into trouble last year after the disclosure of more than $4 billion in hidden debt left many UAE and overseas lenders with heavy losses.

In September 2022, ADGM Courts had appointed Richard Fleming and Ben Cairns of Alvarez & Marsal as administrators for NMC Healthcare’s group of operating companies and businesses.

In April, Alvarez & Marsal said it had received approval of $6.4 billion from lenders. This includes $6.3 billion from a group of 136 creditors and another $650 million potential claims of 10 creditors.

A judge in Abu Dhabi ruled in favour of Dubai Islamic Bank (DIB) and against the administrators of NMC in May 2021. DIB, with over $400 million in exposure to NMC, lent to the company using collateral known as insurance receivables, which relate to payments by insurance companies for medical treatment.

“The resounding level of support from creditors reflects the positive sentiment towards the collective approach we have taken throughout this process to ensure the group optimises value for creditors,” said Richard Fleming.

“This is a hugely significant moment in the restructuring process of the Group and provides another layer of stability as we move onto the next chapter for NMC,” he said.

The Joint Administrators will shortly launch the formal voting process to complete the financial restructuring of the NMC business and transfer ownership to the creditors, said a statement issued by the NMC administrators.

— waheedabbas@khaleejtimes.com



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