BR Shetty

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2020: troubled times

Stanley Pinto, February 20, 2020: The Times of India

MANGALURU: BR Shetty, the richest Kannadiga in the world with an estimated net worth of $1.6 billion, is in trouble. Shares of his flagship company, Abu Dhabi-based NMC Health, has dropped 70% since mid-December, following allegations by an US investment firm that NMC made potential overpayment for assets, inflated cash balances and understated debt.

News agency Bloomberg reports that Shetty resigned as the company's co-chairman on February 17, after the board demanded that he do so. "NMC has lost four board members since Friday, including vice-chairman Khaleefa Butti, whose holdings are also being probed," the agency said.

Carson Block, founder of Muddy Waters, the investment firm that levelled charges, said in a tweet: "The share ownership and pledge debacle is a symptom of systemic rot and corruption at NMC."

Shetty himself named ex-FBI director to probe scandal

A source close to BR Shetty said the entrepreneur from Karnataka himself had appointed a former FBI director to investigate the allegations of financial irregularities against NMC. He alleged that Muddy Waters had made similar and baseless charges against other companies, including Tesla. He said Shetty had stepped down from the directorship only to ensure a fair probe.

“In fact, Shetty was not in active management for the past four years and was concentrating on his India ventures. Prashant Mangat, the present CEO, was managing the affairs,’’ the source said, adding, the hospital chain was profitable. Shetty, when contacted by TOI , said he was in good health, but declined to comment.

Shetty undertook a 1,000-mile journey from Udupi to the UAE in 1973—to repay a debtwhich transformed him from a medical representative to a billionaire, owning one of the UAE’s largest hospital chains, NMC Health. The debt was a small loan taken from KK Pai, former chairman and managing director of Syndicate Bank, to get his sister married. Shetty owns two posh pads at Burj Khalifa, has a private jet and a collection of vintage cars.

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