NMC founder Shetty considers selling UAE-based drugs firm, sources say

Shetty has been under financial pressure after pledging shares in UAE-based hospital operator NMC

  
Dr BR Shetty

Dr BR Shetty

NMC Health founder BR Shetty is considering selling all or some of his Abu Dhabi-based pharmaceutical business Neopharma, which is valued at about $1 billion, two sources told Reuters on Tuesday.

Shetty has been under financial pressure after pledging shares in UAE-based hospital operator NMC, the target of a short-selling attack by Muddy Waters, as collateral for loans and shares in other companies.

BRS Ventures has seen preliminary expression of interest for Neopharma from buyers that include international investors and companies, one of the sources familiar with the plan said.

Neopharma, which was founded in 2003, says it has 10 manufacturing facilities spread across three continents.

BRS Ventures declined to comment. Bloomberg earlier reported that Neopharma could be valued at $700 million to $1 billion.

STAKE CUTS

In separate filings, Saeed Mohamed Butti Mohamed Khalfan Al Qebaisi and investor Khaleefa Butti Omair Yousif Ahmed Al Muhairi trimmed their stakes in NMC.

Qebaisi cut his stake to 5.23% from 11.38%, while Muhairi was left with 3.14%, compared to an earlier position of 19.73%.

NMC's stock has been hammered since U.S. based short-seller Muddy Waters launched an attack on its financial statements.

NMC said on Monday it would ask for an informal debt standstill to stabilise its finances and also confirmed that Moelis MC.N would advise it in talks with banks.

It had then added that its key shareholders, former co-chair B R Shetty, Muhairi and Qebaisi, own a combined stake of less than 30% its shares.

That had triggered a change of provision for NMC's debt facilities as its principal shareholders cease to own more than 30% of stake in the company, affecting a $2 billion loan facility and certain other facilities.

(Reporting by Saeed Azhar in Dubai and Muvija M in Bangalore; additional reporting by Yadarisa Shabong in Bengaluru; Editing by Shinjini Ganguli and Alexander Smith) ((Yadarisa.Shabong@thomsonreuters.com; within UK: +44 020 7542 1810; outside UK: +91 80 6182 2784;))

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