Clifford Chance

Clifford Chance advises the Ad Hoc Creditors' Committee of NMC Healthcare on its ground-breaking USD 7 billion financial restructuring, including the first ever use of ADGM administration and deeds of company arrangement

International law firm Clifford Chance advised the ad hoc creditors' committee of NMC Healthcare on the group's ground-breaking USD 7 billion financial restructuring, which will see the operating group exit from administration under the Insolvency Regulations of the Abu Dhabi Global Market (ADGM) pursuant to deeds of company arrangement. This is a landmark transaction for the region and the first time that either procedure has been used in ADGM.

NMC is the largest healthcare provider in the UAE, and was formerly a member of the FTSE 100. In early 2020, just as the Covid-19 pandemic was beginning, it emerged that the group had underreported its liabilities by over USD 4 billion, and that as a result the group was heavily insolvent. Clifford Chance began by advising the lenders under the group's largest credit facility, before eventually pivoting to a role for an ad hoc creditors' committee of leading regional and international banks and financial investors. The firm supported its clients in providing the group with the stability that it needed to continue trading before developing and implementing a more permanent solution.

The transaction has separated the operating part of the group from its former holding company, NMC Healthcare Ltd, and its previously-listed parent, NMC Health plc. These entities will remain in insolvency to pursue litigation claims. The operating group has exited administration, and benefits from a balance sheet cleansed of approximately USD 6.7bn of pre-insolvency debt, with an additional AED 1.29bn (approximately USD 350m) new money facility provided by a syndicate of lenders and underwritten by certain members of the committee. Creditors will receive participations in an innovative USD 2.25bn profit participating loan facility owing from a new holding company for the operating group, with the option to elect for conventional or Islamic commitments. The new facility benefits from shareholder-like governance controls in respect of the restructured group.

ADGM is a common law jurisdiction in the United Arab Emirates, and the administration and deed of company arrangement procedures are based on equivalent procedures under English and Australian law respectively, allowing Clifford Chance to draw upon its deep experience with each of those regimes, as well as its understanding of regional nuances.

This was a transaction of extraordinary complexity and importance that drew upon specialists from the firm's globally top-ranked restructuring, finance, corporate, and disputes practices, and its market-leading capabilities in the UAE, all ably supported by the firm's innovation and legal project management team. The deal team was led by London restructuring partner Iain White and senior associate Tim Lees; London and UAE corporate partners Daud Khan and Mike Taylor; and UAE finance partners Nicola Reader and Qudeer Latif, and included Sarah Jane O'Leary and Michael Panayi (restructuring, London); James Dadford and Ahmed Shafiek (corporate, UAE); Millecent Smit, Krish Mistry, and Sarah Boyd (corporate, London); Bola Coker, Anthony Matsis, and Nadia Mardan Ali (finance, UAE); Paul Coates (litigation, UAE); Giles Allison, Lyle Risk, and Murray Tabeart (litigation, London) and Jack Hardman (regulatory, UAE)