Shares in NMC Health and Finablr plunged after two major shareholders launched a discounted share sale in the London-listed groups, weeks after NMC was hit by a short-selling attack by U.S. firm Muddy Waters.
The healthcare firm’s vice-chairman Khaleefa Al Muhairi and its second-largest shareholder Saeed Al Qebaisi have together sold NMC shares worth 375 million pounds.
The deal was priced at 1,200 pence per share, a bookrunner said on Wednesday, adding that the sale was oversubscribed. The price is at a discount of about 20% to NMC’s last close of 1,494.5 pence in London.
Qebaisi and Muhairi have also sold shares worth about $72 million in payments firm Finablr, which is co-chaired by Bavaguthu Raghuram Shetty, also the founder and co-chairman of NMC.
Shares in Finablr, whose ransomware-hit Travelex unit is also chaired by Muhairi, were sold at 135 pence per share, a discount of nearly 13%, sending shares to a record low.
NMC shares were down 15.8% at 1,258.5 pence.
The investors sold the shares to repay some of their debt and the debt of some corporate entities owned by them, the bookrunner said, adding that the move will also remove the pledge on NMC shares under a borrowing agreement with two banks.
The sale was not related to NMC’s operating performance or long-term prospects, the firm said in a statement, adding the shareholders “remain supportive”.
Finablr was not immediately available for comment.
Following the transactions, Muhairi will retain a 12.5% stake in NMC while Qebaisi will keep a 4.7% holding, the bookrunner said, adding that they jointly hold roughly an additional 7% in NMC through Infinite Investment.
Reuters reported https://in.reuters.com/article/us-nmc-health-m-a-exclusive/exclusive-two-groups-one-backed-by-chinas-fosun-bid-for-nmc-health-stake-sources-idINKCN1VB20R last year that two groups were bidding for a 40% stake in NMC, which was jointly owned by UAE-based businessman Qebaisi, Muhairi, and Infinite Investment.
Reuters could not immediately reach the investors for comment.
NMC, the United Arab Emirates’ largest private healthcare provider, has launched an independent review of its finances after short-seller Muddy Waters questioned the value of its assets and cash balance while announcing a short position.
Earlier this week NMC said the review will initially assess its cash balances as of Dec. 15.
Short selling involves borrowing an asset and selling it with the aim of buying it back at a cheaper price for profit.
Muddy Waters, founded by American Carson Block, is known in financial markets for declaring short equity positions on the basis of in-house research.
At Wednesday’s session low, NMC, which has denied the allegations, had lost nearly 3 billion pounds in market value since the report was launched.
