Dubai: US-based short-seller Muddy Waters on Tuesday acquired a short position in UAE-based NMC Health Plc, sending the hospital operator’s London-listed shares plummeting nearly 30 per cent.
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Short seller Carson Block’s firm expressed “serious doubts” about the NMC Health’s reported profits and debts, while also questioning the value of NMC’s assets, cash balance.
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“NMC’s reported cash balances show two red flags that indicate they could be materially overstated,” the short seller said, adding NMC’s margins appear too high in comparison to other UAE-focused operators like Mediclinic International and Aster DM Healthcare.
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“We believe that NMC has manipulated its balance sheet to understate debt,” Muddy Waters said.
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NMC declined to immediately comment on the Muddy Waters report.
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Shares of NMC Health plunged as much as 27 per cent, its biggest percentage loss since going public in 2012, which wiped out about $2 billion (Dh7.35 billion) in market value.
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