The management at NMC Health have been tasked with creating "a stable platform before commencing the restructuring and turnaround, with the key immediate priority being the monitoring of liquidity of the group", according to a letter sent to the company's lenders by its acting chief executive Michael Davis.
The letter sets out a new governance structure for the group, with a pair of co-chief restructuring officers being appointed by joint administrators from Alvarez & Marsal to advise the newly-appointed board.
Antonio Alvarez III and Maxim Frangulov of Alvarez & Marsal have been nominated as co-chief restructuring officers. NMC Health's management will report to them, the letter states. Alvarez & Marsal will also supplement NMC Health's finance team and healthcare operations team, where required.
"We look forward to working closely with the board, Michael Davis and the operational management teams to help them stabilise the businesses. A key action will be moving to augment capabilities, particularly in the finance area, where there have been several key departures," Mr Alvarez said in the letter.
"We will also be working diligently with NMC’s financial creditors to quickly rebuild confidence and trust in NMC and to develop and execute a business restructuring," he added.
NMC Health was founded in Abu Dhabi in 1975 by Bavaguthu Raghuram Shetty and grew to becoming the UAE's biggest healthcare company – a FTSE 100-listed business employing 2,000 doctors and almost 20,000 other staff operating in 19 countries.
However, signs of trouble in the business emerged in December after activist investor Muddy Waters published a report arguing the company had inflated cash balances, overpaid for assets and understated its debt. This set off a chain of events which led to the company revealing significant shareholders had incorrectly stated the size of their shareholdings and that the company's debt, at $6.6bn, was substantially higher than the $2.1 billion declared in its accounts. A review committee appointed to investigate the company's affairs also found evidence of "suspected fraudulent behaviour".
NMC Health's lenders are forming a coordinating committee, with a steering group acting as the primary contact between the company and its debtors. Abu Dhabi Commercial Bank, which is owed $981m and is NMC Health's biggest creditor, will chair the co-ordinating committee. The bank will also form a steering group with other significant creditors, including Abu Dhabi Islamic Bank, Dubai Islamic Bank, Barclays and Standard Chartered.
ADCB is being advised by Lazard as committee chair, with the committee being advised by Deloitte and Clifford Chance.
The chairman of Ithmar Capital, Faisal Belhoul, who briefly became chairman of NMC Health on March 26 until its administration, after his private equity firm acquired a 9 per cent stake in the company, urged its new board "to act swiftly, equitably and in the best interests of all parties".
"I remain at the disposal of the company, not only as a shareholder but rather as a professional with healthcare sector experience acting in what I see a national duty at this time when the UAE is making every effort to control the spread of the Covid-19 pandemic," he said in a statement on Tuesday.
“I also reiterate that it remains crucial that the investigation into any and all prior wrongdoings at the company is fully supported and pursued with the relevant authorities, and that all involved parties are held accountable from within or outside the company. I will do all in my power to support this process,” he said.
In a statement following the appointment of administrators last Thursday, NMC Health's founder Mr Shetty said he was undertaking his own investigation and would make his findings known "as soon as possible, and in the proper and appropriate manner".
"I am extremely eager and determined to bring to light the full facts, and the whole truth," Mr Shetty said.