(Adds details from NMC statement)
Dec 19 (Reuters) - NMC Health Plc said on Thursday that a report by U.S. short-selling firm Muddy Waters earlier this week criticising the healthcare group’s financial statements was “false and misleading”.
The short seller on Tuesday acquired a short position in NMC Health and questioned the value of the London-listed firm’s assets and cash balance, as well as its reported profits and debts, wiping a third off the value of the company’s shares.
Muddy Waters, known in financial markets for declaring short equity positions on the basis of its in-house research, also said that NMC’s asset purchase prices and capital expenditures were inflated.
In a lengthy statement released after markets closed on Thursday, its first detailed response to the allegations listed by Muddy Waters, NMC said it has “a track record of significant, open and increasingly detailed disclosure to the market, as monitored and reviewed by its entirely independent disclosure committee”.
In particular, NMC defended its debt position, saying it has been in a “high-growth delivery phase” backed by long-term debt facilities - loans which it has refinanced with better margins and commercial terms.
In response to Muddy Waters’ allegations around inflated capital spend, NMC said it had monitored and disclosed the amount spent on each of six projects announced at the time of its market debut in 2012.
NMC, with operations in 17 countries, also rejected Muddy Waters’ allegation that the price for its acquisition of a 70% stake in Premier Care Home Medical was inflated.
A spokeswoman for Muddy Waters, a company founded by American Carson Block, said the short seller would issue a statement by email in due course.
NMC’s shares closed down 11.1% at a three-year low of 1536.5 pence on Thursday. (Reporting by Noor Zainab Hussain in Bengaluru; Editing by Jan Harvey, Kirsten Donovan)