BR Shetty and two other directors resign from NMC Health

The announcement was made in a regulatory filing to the London Stock Exchange

Abu Dhabi, United Arab Emirates. June 30, 2019. Dr. B.R. Shetty is the founder of BRS Ventures, Finablr, and NMC Health. Leslie Pableo for The National FOR: For Podcast Section:
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BR Shetty, founder of the embattled London-listed NMC Health, resigned as director and joint non-executive chairman of the company, after he and former vice chairman Khalifa Al Muhairi were removed last week from board discussions on concerns they may have misstated their stakes in the firm.

The announcement was made in a regulatory filing on Monday to the London Stock Exchange, where the company's shares trade. Mark Tompkins, the chairman of the company, will continue as the sole non-executive chairman of NMC Health, according to the filing. Following the disclosure, the company's share price slid 8 per cent by 12.30pm UAE time on Monday.

Mr Shetty said in a statement to The National he resigned from the board of directors of the company to allow it to fully execute its governance and other responsibilities, in "as efficient a manner as possible".

“As you will have seen from recent market disclosures, we have initiated a full legal review of our shareholdings in NMC Health in order to provide greater clarity and transparency to the market, as well as to our other stakeholders.

“In order to assist us and expedite the completion of this process, we have engaged third-party legal and financial advisers. We are also in consultation with the appropriate regulatory authorities in the UK,” he said.

“During this review process, we will continue to disclose information to the market in as timely a fashion as possible."

Two more directors also resigned, according to separate filings by NMC Health on Monday.

Hani Buttikhi, who was appointed as executive director and chief investment officer in June 2017, resigned with immediate effect.

In his resignation letter to the board, Mr Buttikhi said "he first became aware of previously-unreported share transactions between the principal shareholders in recent days when they were notified to, and then announced by, the company", according to the statement.

Mr Buttikhi told the board "given his connection to shareholders who had nominated him ... he felt that it was appropriate that he step down", as a result of the recent disclosures.

Abdulrahman Basaddiq, a non-executive director with NMC Health since 2014, also resigned immediately, according to another filing with the LSE.

Mr Basaddiq said he had "no knowledge of any possible transfer of ownership of shares between the principal shareholders in May 2017, nor in relation to some unreported pledges and/or  other securitisation of shares by the principal shareholders".

Both men had been appointed under agreements between the company and Mr Shetty, Mr Al Muhairi and Saeed Al Qebaisi, which "permitted the principal shareholders to appoint a number of their nominees to the board", the statements said.

Mr Al Muhairi, who had served as vice-chairman, resigned on Friday with immediate effect.

A company filing last week said 20 million shares held by one of Mr Shetty’s companies, BRS International Holding, could ultimately be owned by shareholders Mr Al Muhairi and Mr Al Qebaisi. This would reduce the amount of shares publicly held by Mr Shetty by 9.58 per cent.


A number of these shares had been pledged as collateral with various lenders, some of whom had taken ownership of the stakes.

NMC Health's stock has lost two-thirds of its value since mid-December when the US short-seller Muddy Waters alleged that NMC had manipulated its balance sheet and inflated the prices of companies it acquired.

NMC said claims by Muddy Waters were false and the company hired former FBI director Louis Freeh to conduct an independent review.

Mr Al Muhairi is the founder and chairman of KBBO Group based in Abu Dhabi, which has investments in health care, education, retail, financial services and technology. He is also vice chairman of Centurion Investment, which is led by Mr Al Qebaisi.

He is NMC Health’s second-biggest shareholder, according to Refinitiv data. The company website says Mr Al Muhairi “led its successful IPO and premium listing on the London Stock Exchange in 2012”.

Following its 2012 London listing when it raised £112 million (Dh536.3m), NMC Health was promoted to the blue chip FTSE 100 index in 2017.

NMC Health owns and manages more than 200 healthcare facilities, including hospitals, medical centres, day surgery centres and home health clinics across the UAE, UK and Europe.The facilities treat more than 8.5 million patients a year, according to its website.

In 2019, NMC Health reported lower net profit for the first half of the year of $138.1m (Dh506.8m), while revenue climbed 33 per cent year-on-year to $1.24 billion.