Muddy Waters Short Report Sends NMC Health to Record Plunge - Bloomberg:
NMC Health Plc shares tumbled the most on record after the London-listed hospital operator became the latest target of short seller Carson Block’s Muddy Waters Capital LLC.
The health-care company’s financial statements hint at potential overpayment for assets, inflated cash balances and understated debt, according to a report on Muddy Waters’s website. Shares of NMC Health plunged as much as 35%, wiping out about 1.9 billion pounds ($2.5 billion) in market value. Company representatives declined to comment immediately.
Financial services company Finablr Plc, which listed in May, dropped as much as 18%, and the benchmark FTSE 100 Index fell 0.2%. Both NMC Health and Finablr were founded by Abu Dhabi-based billionaire Bavaguthu Raghuram Shetty.
NMC appears to have overpaid for its investment in redeveloping an Abu Dhabi hospital and for a stake in Premier Care Home Medical and Health Care LLC, the report said. Its margins also appear too high in comparison with rivals like Mediclinic International Plc, according to Muddy Waters. Reported cash balances are high when compared with the amount of interest the company has reported earning, the short seller said.
NMC Health Plc shares tumbled the most on record after the London-listed hospital operator became the latest target of short seller Carson Block’s Muddy Waters Capital LLC.
The health-care company’s financial statements hint at potential overpayment for assets, inflated cash balances and understated debt, according to a report on Muddy Waters’s website. Shares of NMC Health plunged as much as 35%, wiping out about 1.9 billion pounds ($2.5 billion) in market value. Company representatives declined to comment immediately.
Financial services company Finablr Plc, which listed in May, dropped as much as 18%, and the benchmark FTSE 100 Index fell 0.2%. Both NMC Health and Finablr were founded by Abu Dhabi-based billionaire Bavaguthu Raghuram Shetty.
NMC appears to have overpaid for its investment in redeveloping an Abu Dhabi hospital and for a stake in Premier Care Home Medical and Health Care LLC, the report said. Its margins also appear too high in comparison with rivals like Mediclinic International Plc, according to Muddy Waters. Reported cash balances are high when compared with the amount of interest the company has reported earning, the short seller said.
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