Muddy Waters challenged the value of NMC’s assets and cash balance as well as reported profits and debts, triggering a major sell-off in the stock that has wiped out half the company’s market value.
NMC, the largest private healthcare provider in the United Arab Emirates, said on Monday the review would be undertaken by an unidentified accounting firm and overseen by a committee of independent NMC non-executive directors.
“We are confident that this review, when complete, will be entirely confirmatory of the disclosures provided by the company to date,” NMC said.
The company, the first from Abu Dhabi to list on the London Stock Exchange, last week stood by its 2019 and 2020 forecasts, and issued a detailed response to the allegations from Muddy Waters.
Muddy Waters, founded by American Carson Block, is known in financial markets for declaring short equity positions on the basis of its in-house research.
The company had no immediate comment on Monday on NMC’s decision to launch an independent review.
(Reporting by Pushkala Aripaka in Bengaluru; Additional reporting by Maiya Keidan; Editing by Saumyadeb Chakrabarty and Mark Potter)