Alvarez & Marsal, the administrator of the UAE's biggest healthcare operator NMC Health, plans to apply to the UK High Court for a further extension for the company's plc entity early next year.
While the FTSE-100-listed company's UAE entity should exit administration in the next six weeks, according to Alvarez & Marsal, and start operations under new ownership next year, the UK administration process will need more time.
Richard Fleming, the joint administrator who leads Alvarez & Marsal’s restructuring practice in Europe, said the application to extend is “a totally natural thing”.
“You get appointed a year at a time, so every year you extend. Because we are litigating against third parties, those litigations will take some time, so you just go through a process of extending every year, that's just a normal thing,” he said with the plc administration set to last "as long as the litigation lasts".
Mr Fleming said the company will apply for the extension in March to tie in with the anniversary of when they were appointed on April 9, 2020.
Alvarez & Marsal has incurred fees of about £51 million ($68.2 million) since it was appointed administrator of NMC Health’s group operating companies in the UAE in September last year. Separately, it has incurred fees of £21.6m since it was appointed administrator of the plc entity, according to the latest filings.
Mr Fleming said the £51m "relates to all the work we've been doing on the operating business in the UAE, with 35 different entities in administration".
"Those entities are coming out of administration once we complete on the docket, which we're hoping to do in the next six weeks," he said.
NMC Health was founded by BR Shetty in 1975 and grew to be the UAE's biggest privately-owned healthcare operator. The company's shares were listed on the London Stock Exchange and at its peak in 2018 it was valued at £8.58 billion.
But the business collapsed last year after a report from short seller Muddy Waters in December 2019 alleged the company had inflated the value of its assets and understated its debt. That led to the appointment of Freeh Group as independent investigators, who uncovered more than $4bn of previously unreported debt, taking the total to more than $6.6bn.