Troubled Middle Eastern hospital group NMC Health is on the verge of falling into administration after failing to reach a deal with creditors.
NMC, which was until recently part of the FTSE 100, said in a brief statement on Wednesday afternoon it had failed to reach a deal with creditors trying to place it into administration.
As a result, NMC warned it “expects the company to be placed into administration in due course.”
It emerged over the weekend that Abu Dhabi Commercial Bank (ADCB) has applied to the UK’s High Court to forcibly appoint administrators to NMC Health. A hearing is scheduled for Thursday 9 April.
NMC had been trying to convince ADCB and other creditors to abandon the action but said on Wednesday it had “not been able to secure their alignment and support” despite “strenuous efforts” to address concerns.
The administration push comes after months of scandal and turmoil at the company.
US short seller Muddy Waters raised questions about the company’s true level of debt in December. NMC vigorously denied the allegations and hired a former FBI director to investigate the claims.
Trading in NMC’s shares was suspended in February after the independent investigation found inconsistencies in the company’s finances. The UK’s Financial Conduct Authority (FCA) opened an investigation into the business at the same time.
Last month, NMC said investigators had discovered $2.7bn (£2.2bn) of undisclosed debt, more than double what the company had previously announced. Other inconsistencies have also been discovered and the company has had trouble clarifying the ownership of shares among key investors.
NMC Health’s management have largely been cleared out since the start of the year as it struggles to repair the damage.
NMC operates around 200 hospitals in the Middle East, mostly in the United Arab Emirates (UAE), and distributes medical supplies in the region.
Shares had lost over 60% of their value by the time trading was halted but the company was still worth £2bn at the time of suspension. NMC Health was relegated from the FTSE 100 while trading was still suspended. Shares remain suspended.