Bavaguthu Raghuram Shetty, founder of two FTSE 350 companies, NMC Health and Finablr, is the latest Indian-born industrialist to be sucked into major legal battles with banks around the world who are hounding him to recover loans even as his empire starts to crumble.
Barclays has initiated proceedings to repossess the beleaguered Indian-born tycoon’s luxury penthouse in London’s Regent Park even as he battles Bank of Baroda’s lawsuits to seize his properties in India in an effort to extract dues worth Rs 1900 crore.
Shetty, who is currently based in Dubai, has seen his troubles explode ever since his sprawl of businesses from pharmaceuticals to real estate and tea started to flounder amid an eddying fraud scandal stretching from Mumbai to London.
Barclays has been granted a worldwide freezing and asset disclosure order even as it battle to gain control of the London property off Prince Albert Road. The order was granted in the Dubai International Financial Centre Courts in September 2020
He had sought permission from Barclays, a creditor to Shetty’s businesses, to sell the property to fund legal expenses. A UK court denied the permission.
Shetty, who had a fortune estimated at $ 3.2 billion in 2019, has been dogged by lawsuits in India as well. Bank of Baroda has been trying to seize 16 properties of the businessman in Karnataka because of his unpaid debts.
A former pharma salesman, Shetty immigrated to Abu Dhabi in the UAE in 1973 and later established NMC Health, the largest healthcare chain in the Middle East, which was listed in London Stock Exchange in 2012.
The tycoon, 79, stunned India’s tea fraternity in 2018 when he made an audacious bid for Assam Company India.
He acquired 15-odd gardens and interest in Amguri oil field in Assam for Rs 700 crore from an insolvency process. The bid was much higher than the second highest bid and the going market rate.
A year later, Shetty listed Finabir, the holding company for his money remittance firms UAE Exchange and Travelex Group in the UK.
NMC’s trouble started brewing in late 2019 when Muddy Waters, a San Francisco-based short-seller, raised concerns about its accounting and governance. The scandal spread to Finablr, which had been listed in London in May that year.
NMC's collapse sparked fraud and regulatory investigations, including one by UK’s Serious Fraud Office, and concerns over the role of City advisory firms and EY, the auditor, which faces large claims.
Abu Dhabi Commercial Bank, a major creditor to NMC, has succeeded in appointing an administrator, Alvarez & Marshal, of the health care chain. The bank is majority owned by the Abu Dhabi government.
Shetty is believed to be living in Mangalore, Karnataka, his home state. Even though he faces multiple court cases in India as well, the tea gardens in Assam are operational.
“It is business as usual in the gardens, so far. Teas are being produced and the workers are getting paid. The gardens are managing the affairs from internal cash flow,” said people aware of ACIL’s affairs.
With inputs from The Times, London
