UAE: Bavaguthu Raghuram Shetty (popularly known as B R Shetty), is being removed as chairman of the NMC Health Plc’s board discussions after he said that he may have misreported the size of his stake.
According to a report by Bloomberg, B R Shetty is conducting a legal review into the size of his stake. Reportedly, the company has also asked all its shareholders to clarify whether they have pledged any of their holdings as collateral amid speculations that they might have faced a margin call.
It can be recalled that NMC Health Plc’s stock value dropped to almost half its value last week in London.
The company is conducting an independent review after short seller Muddy Waters Capital LLC alleged that NMC had insufficiently disclosed of related-party transactions, manipulated the balance sheet and inflated its asset purchases among others.
NMC shares fell more than 70% after the Muddy Waters’ report surfaced in December 2019. This left the company with a market value of less than 1.5 billion pounds. The allegations made in the report have been denied by NMC, which says that they are false and misleading.
Shetty and vice-chairman Khaleefa Butti Omair Yousif Ahmed Al Muhairi have been asked by the company not to attend any board meetings until the size of their stake is clarified. The hospital operator added that a decision would be taken about whether or not Shetty and Butti should remain as directors of the board.
The company, which is presently the biggest private health-care provider in the United Arab Emirates, was founded by B R Shetty when he moved to Abu Dhabi in the 1970s.
