10th Mar 2020 16:25
(Alliance News) - NMC Health PLC warned on Tuesday some USD2.7 billion of debt has been discovered the board was not aware of.
NMC earlier in March appointed Moelis & Co and accounting firm PricewaterhouseCoopers to help with talks with lenders and to find out the firm's true financial position.
NMC, it said Tuesday, has been informed the debt position is significantly bigger than previously believed and is currently thought to be around USD5 billion. Work on verifying this figure is "ongoing".
Shares are currently suspended from trading but were last quoted at 938.40 pence each, giving a market capitalisation of GBP1.96 billion, significantly lower than its debt.
As at June 30, NMC had reported debt at USD2.1 billion, but some USD2.7 billion has now been found which the board had not been made aware of or approved.
"NMC is continuing to work with its advisers to understand the exact nature and quantum of the undisclosed facilities. The board believes some proceeds may have been utilised for non-group purposes," said NMC.
"NMC is fully focused on safeguarding its operational liquidity to continue funding existing operations throughout its various subsidiaries and recently successfully completed the payment of its February payroll."
NMC has been grappling with a myriad of problems the past few months, starting with an attack over its financial statements late in 2019 from short-selling firm Muddy Waters. It has also been trying to work out the true shareholdings of some major investors.
Former Chief Executive Prasanth Manghat was fired at the end of February over discrepancies in company finances, while founder and Non-Executive Chair Bavaguthu Raghuram Shetty resigned the same month after being banned from board meetings for inaccurately reporting his shareholding.
By George Collard; [email protected]
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