Deloitte starts re­view of Abraaj’s busi­ness

Viet Nam News - - WORLD BUSINESS -

DUBAI — Abraaj has hired Deloitte to ex­am­ine its busi­ness, in­clud­ing its trou­bled US$1 bil­lion health­care fund, af­ter in­vestors ques­tioned an ear­lier re­view by KPMG of the em­bat­tled fund, peo­ple fa­mil­iar with the mat­ter said.

Abraaj has been try­ing to stem the fall­out from a row with four of its in­vestors, in­clud­ing the Bill & Melinda Gates Foun­da­tion and the In­ter­na­tional Fi­nance Corp (IFC), over the use of their money in the fund.

A Deloitte team, in­clud­ing spe­cial­ists in foren­sic ser­vices, is work­ing in­side Abraaj’s of­fice to help the health­care fund re­view its gov­er­nance and con­trol mech­a­nisms, the sources said.

Abraaj said in an email it does not com­ment on man­dates for its ad­vis­ers, while Deloitte de­clined to com­ment. KPMG, the Gates Foun­da­tion and IFC have also de­clined to com­ment.

Some in­vestors felt the month­long KPMG re­view, com­pleted on Fe­bru­ary 7, was con­ducted too quickly and was not com­pre­hen­sive, one of the sources said. Deloitte was there­fore brought on board by Abraaj to con­duct a sep­a­rate re­view, the sources added.

Abraaj has said KPMG con­ducted a re­view based on agreedupon pro­ce­dures and had ver­i­fied that all pay­ments and re­ceipts in the fund were in line with agreed pro­ce­dures.

Abraaj’s founder Arif Naqvi handed day-to-day run­ning of the in­vest­ment man­age­ment busi­ness to two co-chief ex­ec­u­tives and the group was split into Abraaj In­vest­ment Man­age­ment Ltd (AIML) and Abraaj Hold­ings in late Fe­bru­ary.

Naqvi re­mains CEO of Abraaj Hold­ings, a sig­nif­i­cant share­holder of AIML, the fund man­age­ment busi­ness.

Abraaj, founded in 2002 by Pak­istan-born Naqvi, has shaken up

A Deloitte team, in­clud­ing spe­cial­ists in foren­sic ser­vices, is work­ing in­side Abraaj’s of­fice to help the health­care fund re­view its gov­er­nance and con­trol mech­a­nisms.

its man­age­ment, sus­pended new in­vest­ments and freed up large in­vestors from mil­lions of dol­lars in cap­i­tal com­mit­ments af­ter de­cid­ing to sus­pend in a planned $6 bil­lion new fund.

The firm was man­ag­ing $13.6 bil­lion be­fore it de­cided to re­turn money to its in­vestors in its new fund.

In­vestors in the health­care fund have hired Ankura Con­sult­ing to de­ter­mine whether Abraaj breached any agree­ments on money that was not in­vested but was drawn down, sources told Reuters ear­lier. Ankura has not re­sponded to Reuters queries

“We are work­ing col­lab­o­ra­tively on a range of is­sues with in­vestors in our Health­care Fund while also pre­serv­ing the Fund’s vi­tal mis­sion of de­liv­er­ing af­ford­able, ac­ces­si­ble and qual­ity health­care to un­der­served mar­kets,” Abraaj said when asked about how the money was han­dled.

Abraaj had ear­lier said it had re­turned the un­used cap­i­tal in De­cem­ber, fol­low­ing dis­cus­sions with in­vestors and de­nied al­le­ga­tions that it mis­used the cash.

Abraaj has seen se­nior de­par­tures in­clud­ing the res­ig­na­tion of its chief fi­nan­cial of­fi­cer and is con­sid­er­ing sell­ing part of its in­vest­ment man­age­ment busi­ness, three sources fa­mil­iar with the mat­ter told Reuters last month. — REUTERS

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