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Anta and PeptiDream are 2. Note that the recent share price drawdown is most likely down to macros and not due to MW.
Rastuss, true, but they have also been wrong on a number of occasions, and you can't ignore that. I don't think there's any point getting drawn into the validity of MW's report, clearly in terms of overstated debt they were correct but their rationalisation may yet prove to be incorrect, they claimed they had overpaid for tangible assets and we don't yet know if this is true. There's no mention in the report of the 2.7Billion. The most pressing issue for NMC at the moment is how that debt can be restructured. My argument is that I think the lenders will allow them to restructure and in the absence of material facts their actions lead me to believe a restructure is possible.
Also, would rather not get drawn into Finablr, but in response I'm not sure why Shetty would want to orchestrate a hack that caused the whole debacle with them in the first place, and then exacerbated by the current global slowdown. The fraud is a different point that's added to Fin's mounting problems.
Denmark, I didn't say MW we're completely wrong just that they got lucky with the size of undisclosed debt. There are parts of their analysis that I disagree with and continue to disagree with until the corrected financial statements come out. Like you say, no-one could have known the size of the fraud, so that inherently means MW for lucky with regards to it. Hope that makes sense.
I take your point Rastuss but I respectfully disagree, i do believe MW got lucky. They're a relatively small operation without the clout or man power to do anyhting else apart from fundamental analysis. At one point even Carson Block said he didn't think NMC was a complete fraud just that they had overstated/understated etc. I've done some analysis on competitor ratios and have posted on one of my previous messages as to why I don't think NMC have overstated, obviously I could be wrong, but is one reason why I think MW could be wrong in relation to overstated ratios.
Finablr was sunk, finally by the 100, but it was going down anyway due to cashflow problems caused by its association with Shetty and Mhangat. Also, I think I read somewhere that cornavirus was causing remittances to go down, happy to be corrected on this, travel has been restricted by governments so less requirements for forex plus the fact Travelex was hacked in Dec. There's several reasons why Finablr is struggling right now and is on brink of collapse. I get the feeling taking on a significant amount of debt requires more than just a couple of signatures and can't emphasise the word fraud strongly enough in the case of NMC's additional debt.
I'm trying to look at this from the perspective of an analyst rather than an investor and as time goes by I'm becoming more bullish. the 2.7Billion was a shocker but I'm interested to see how that plays out. My current thoughts are NMC will be able to find a way out of suspension, but the shareprice will be severly diluted. To what extent I can't say as it depends on what they can do with the 2.7Billion.
Rastuss. The FCA/UAE will be able to give them guidance on what they could do legally from a corporation perspective with regard to the debt. I may be wrong in saying this but if the debt was taken out fraudulently then that brings into question its legitamacy. Would be good to get the viepoint of any legal professionals that may be on this forum. The loans should have been made clear well before the share price was suspended and I would question why the lenders have kept quiet. I don't work in fixed income so not sure what declarations would have to be made by the credit providers themselves.
The covenants that we're aware of, 30% majority owners, seems like it's being negotiated at the moment and I suspect any we're not aware will be part of the negotiations. We have to bare in mind if the creditors saw no value in the business except for the tabgible assets then the business will have already gone into administraion. Especially because as things go on, with the help of advisors and paying staff, cash is being used up that could otherwise pay down the debt.
MW did indeed mention overstated assets/income, understated debt/cash. I have made my points on assets and income. iro debts and cash, MW didn't in fact get this right. They thought NMC had borrowed more than they let on to fund their asset purchases/development, so, everything else that has come out is because they kicked the hornets nest rather than because they knew. On the cash front we still don't know how much NMC have. The banks withheld cash as soon as debt covenants were broken which was the casue of the liquidity crisis. I don't think MW were "sage" like in their review of NMC, i get the impression they found some discrepencies and got lucky with the rest.
Rastuss, from reports I get the feeling that the banks with which the legitimate debts are with are willing to negotiate, I expect this will come at a cost. It's just a matter of time. The "illigitamate" debt is what is less unknown, the FCA and UAE will give guidance to NMC on how theny can proceed with this. Are those bank culpable to some extent considering they may have failed in their own due diligence when lending. Why did they not raise questions when NMC failed to declare said debt.
Iro Assets and Earnings, I think NMC may have stated them largely correctly. I have said in the past most companies tend to overstate assets to some extent anyway depending on how depreciation is applied. I think earnings could be strong and is probably why Shetty has been able to borrow so heavily against NMC.
I'm insterested to know how much of NMC cash the banks have withheld. Is it close to what has been stated by NMC.
When they say restructure the debt I suspect they also mean how much of it can be written off, coupled with how much can be recovered by NMC. Which would lead to less debt exposure. They'll first need to find out who was untimately involved in raising the debt in the first place. Just Shetty or Shetty and the Bhuttis. In any case Shetty and Manghat must have been involved.
This is quite a good article on current situation.
https://gulfnews.com/business/markets/nmc-health-reassures-staff-on-salary-payments-1.70440894
Not sure if the following applies in the case of NMC. Thoughts?
When can a company director be held liable for company debts?
While company status offers valuable protection to a director, there are certain situations where limited liability can be disregarded, leaving the director responsible for paying the company’s debts.
These include:
Overdrawn director’s loan accounts
Signing a personal guarantee
Debts have accumulated due to fraudulent means (such as taking on credit you knew you wouldn’t be able to repay)
Director misconduct
Continuing to pay shareholders dividends whilst the company is insolvent
Withdrawing and/or using company funds for non-business activity; this is an offence known as misfeasance
Disposing of the company's assets at undervalue or no value
I suspect NMC may become a case study in months/years to come but the twists and turns continue.
NMC says its review advisers have informed the committee that they have discovered “evidence leading to suspected fraudulent behavior” in relation to some elements of the company’s previous financial activities.
NMC says it’s “fully committed to investigating these activities and has notified the relevant authorities in the U.K. and U.A.E. to determine what action they also consider to be appropriate”
Moelis, PwC and Allen & Overy continue to support the company, including in its discussions with lenders and to assist in providing transparency with respect to its financial position
“Whilst these various investigations are ongoing, NMC remains fully focused on the provision of its healthcare services in all communities in which it operates, and on its business performance, as well as safeguarding its operational liquidity to continue funding existing operations throughout its various subsidiaries”
Thx Med. Makes perfect sense. Should really have known that. doh
I must have missed other news about Danan stepping in then. At the end of the day Danan are not under any obligation to give NMC any capital and wouldn't unless it was underwritten or they thought NMC would be able to repay.
Perhaps.....it could also mean that they were able to secure better rates than banks were offerring, at the end of the day anything can be bought for a price. Reading between the lines either Mubadala think NMC is profitable or they think it's too strategically important, to allow it to fold. Bankruptcy seems a little further out now.
An Abu Dhabi-owned insurer is helping NMC Health Plc pay overdue bills, according to people familiar with the matter, in what could be a sign the emirate is stepping in to help the embattled hospital operator.
Just speculation but Amanat have withdrawn from bidding for VPS......could they be in the mix? Lot of players and a lot of moving parts.
https://www.laingbuissonnews.com/healthcare-markets-international-content/inbusiness-healthcare-markets-international-content/uae-amanat-holdings-abandons-plans-to-acquire-vps-healthcare/
Adzy, don't think there's anything online yet. Hopefully should appear soon.....otherwise I'll be somewhat embarrassed.
Al Futtaim Group are considering making an offer. Mubadala are keeping a keen eye to see how things unfold.
Rastuss, my assumptions are based on income and growth being as stated. Otherwise the company would have no option than to go into adminstration as it would find it difficult to service its debt. In that case a Mubadala rescue would be a political move. But equity holders would still need to sign off on a buy out in the absence of government legislation.
Also, even in administration there are scenarios where NMC can survive with some shareholder value in tack. It gets quite messy though and the odds are reduced.
Rastuss, the value lies in the opportunity of future cashflows, so we have to hope the net income is as stated or close to it.
Rastuss, It's in the interests of the banks that NMC doesn't go into adminstration unless tangible assets are valued at more than debt and they could fully recover all outstanding.