NMC, the largest private healthcare provider in the United Arab Emirates (UAE), got into trouble last year after disclosing hidden debts of more than 4 billion U.S. dollars.
Its operations in the UAE have been administered by the courts of the Abu Dhabi International Financial Center ADGM. Ownership will soon be transferred to creditors.
However, the results of the legal proceedings initiated by the administrators Alvarez and Marsal in ADGM court against one of NMC’s creditors, Dubai Islamic Bank (DIB), made the healthcare company out-of-pocket and laid the foundation for more legal actions.
“In my opinion, the overall winner of this stage of litigation is Dubai Islamic Bank,” Judge Andrew Smith said at a court hearing this week, according to Reuters.
“In my opinion, the fair order is that the claimant should bear its own costs and should pay 75% of the DIB costs,” he said.
Records show that DIB’s legal fees amounted to 1.2 million U.S. dollars.
The judge ordered that NMC’s dispute over the validity and nature of the securities received by DIB from the company be submitted to London for arbitration, effectively setting aside NMC’s main claim in the Abu Dhabi lawsuit.
“We are satisfied with the key issues in the case that Dubai Islamic Bank was submitted to arbitration. Through arbitration, United The administrator will continue to seek to resolve the DIB’s position,” the joint administrator Richard Fleming Tell Reuters.
“Our core focus is the upcoming corporate arrangement contract. This will provide the most appropriate mechanism to ensure first-class patient care and beneficial results for all creditors.”
DIB did not immediately respond to a request for comment. It borrowed approximately $400 million from NMC using collateral called insurance accounts receivable, which is related to medical expenses paid by insurance companies.
It seeks rights to these securities in a case filed in neighbouring Dubai, and Alvarez & Marsal hopes to include them in the NMC’s management procedures and be supervised by ADGM.