Private equity firm KKR & Co Inc and Switzerland-based GK Investment Holding Group have shown initial interest in NMC Health Plc after the hospital chain initiated a review of the stake of its India-born billionaire founder BR Shetty.
London-listed NMC Health said in a statement it has received preliminary approaches from US-based KKR and GK Investment regarding possible offers for the healthcare company. It added that no proposal has been made yet and there have been no discussions as to the terms of any possible offer.
In a separate statement, the UAE-based company said that Shetty, its joint non-executive chairman, had informed the company that he and his advisers were reviewing the size of the stake held by him and two other major shareholders.
This suggests that the holdings of Shetty and the two other shareholders “have been incorrectly reported historically”, the company said.
The UAE’s largest private healthcare company also said that its board has asked Shetty to step back from board discussions until the matter is clarified.
NMC Health has been under the scanner after the US short-selling firm Muddy Waters, founded by American Carson Block, on 17 December published a report alleging the UAE firm of manipulating its balance sheet and inflating the prices of assets it purchased.
NMC lost £1.8 billion of its value on the day of the publication of the Muddy Waters' report. It later called for an independent review of its finances even as Muddy Waters continued to call the healthcare group's financial statements false and misleading.
The development comes as a big blow to NMC Health after it had become the first company from Abu Dhabi to list on the London Stock Exchange in 2012. Subsequently, in 2017, it was elevated to the elite FTSE 100 index.
Last year, Shetty also took its UAE-based payments and foreign exchange company Finablr public on the LSE. Finablr, whose brands include UAE Exchange, Travelex Holdings and Xpress Money, is facing headwinds as well. Last month, it disclosed that Shetty, its majority owner, had pledged over half the company’s stock as security against debts it incurred buying British travel money firm Travelex in 2015 which negatively impacted its stocks.
In India, Shetty runs his business under the BR Life brand.
BR Life has four hospitals in the country in Udupi, Bengaluru, Thiruvananthapuram, and Bhubaneswar. They have a total capacity of about 1,600 beds. It had acquired Bhubaneswar’s Kalinga hospital in 2018.
Shetty was also looking to acquire the debt-laden SevenHills Hospitals Pvt. Ltd in India that would double his presence in the country. It had also received the approval of the National Company Law Tribunal in July last year.
However, the Municipal Corporation of Greater Mumbai challenged the NCLT order in the Supreme Court last year.