(Alliance News) - Finablr PLC on Tuesday said it intends to potentially seek insolvency to maximise any remaining value in the company, after discovering undisclosed loans against shares worth USD100 million.
"Following the announcement on 16 March 2020 with respect to Finablr's present liquidity situation and ongoing discussions with its lending banks, the board of Finablr has engaged an accounting firm to undertake rapid contingency planning for a potential insolvency appointment with a view to maximizing value in the group," the parent company of travel money firm Travelex said in a short statement. It didn't give the name of the accounting firm.
The Abu Dhabi-based company on Monday reported the resignation of Promoth Manghat as chief executive and had said that it was unable accurately to assess its financial position following discovery of USD100 million worth of cheques, which may have been used as security for financing arrangements for the benefit of third parties.
Finablr, which also had to deal with a major cyber attack at the start of 2020, appointed risk consulting firm Kroll Inc to carry out a more comprehensive review of related-party transactions and on and off-balance-sheet debt, including the issues identified above regarding the cheques and any other contingent liabilities.
Shares in the company were suspended from trading in London on Monday.
Finablr's co-chair, Bavaguthu Raghuram Shetty, also is a founder of NMC Health PLC. Finablr and NMC both have been looking into the true nature of Shetty's holdings in each company.
In December, short-seller Muddy Waters released a damning report into NMC Health, making a series of allegations about governance at NMC.
NMC Health announced on Tuesday last week the discovery of USD2.7 billion of debt of which the board had not been aware. Former chief executive Prasanth Manghat was fired in February over discrepancies in company finances.
Trading in NMC shares also is currently suspended.
By Tapan Panchal; tapanpanchal@alliancenews.com
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