NMC Healthcare LLC plans to file for administration in Abu Dhabi, the UAE hospital operator has confirmed.
In a presentation posted on its website, the healthcare provider revealed its plan to file with the Abu Dhabi financial center ADGM for administration.
Alvarez & Marsal will be appointed as its UAE Business Administrators, it said.
“We are looking to move there as soon as we can,” said Marija Simovic, managing director of Alvarez & Marsal, adding the administrators were working with lenders.
It targets a three-year recovery plan that includes a debt moratorium, debt restructuring and asset sales.
The method of administration is similar to a US Chapter 11 procedure and would require NMC to negotiate a debt settlement agreement with scores of lenders and sell assets to boost its balance sheet.
Its London-listed NMC Health Plc holding company is currently managed by administrators Alvarez & Marsal following months of financial chaos in April.
NMC and its lenders will have until January 30, 2021 as part of their restructuring strategy to implement a binding reorganization plan or the process will shift to core asset sales.
Negotiations will begin soon and by October 31, NMC said, a term sheet will be delivered to lenders.
NMC has agreed to arrange to raise up to $300 million from existing lenders to fund the business as it prepares to enter administration.
NMC said that significant cash has been extracted from the company, resulting in restricted liquidity and defaults on payments to lenders and suppliers.
This year’s NMC implosion following claims of fraud and the discovery of more than $4 billion in undisclosed debt has left some UAE and overseas borrowers with heavy losses and has sparked legal fights that seek to recover the money owed.
The company had a good start in the year 2020, but the latest corona virus outbreak resulted in a substantial decline in sales from March to May.
Performance began to improve in June, it said, with both June and July performing better than forecast.
NMC Health is the UAE’s largest private healthcare provider, running over 200 facilities including hospitals, clinics and pharmacies.
