Dubai's MAF explores partial credit card business sale in review

Majid Al Futtaim operates the Middle East franchise of French retailer Carrefour. (AFP)
Updated 10 October 2019

Dubai's MAF explores partial credit card business sale in review

  • MAF hired US investment bank Moelis & Co at the start of the summer to advise and manage the partial sale of its Najm credit cards, said the sources
  • The company said it continues to explore and evaluate opportunities that support the sustainable growth of its business

DUBAI: Dubai's Majid Al Futtaim, which operates the Middle East franchise of French retailer Carrefour, is exploring options for its credit card business including enlisting partners to manage unsecured credit risk, two banking sources told Reuters.
The economy in Dubai is suffering from sluggish growth due to a real estate downturn and slowing global trade, hitting white-collar jobs and consumer spending.
MAF, a holding company which also owns and operates shopping centres in the Middle East and North Africa, hired US investment bank Moelis & Co at the start of the summer to advise and manage the partial sale of its Najm credit cards, said the sources, who declined to be named.
Should a transaction follow, MAF would hold on to the data portion of the card business and its loyalty programme, while the banks would acquire the loan portfolio, the sources said.
MAF said it continues to explore and evaluate opportunities that support the sustainable growth of its business.
"We are evolving our consumer finance business, Najm, to ensure that it meets the changing needs of its customers and the growing demand for its products," it said in a statement.
"We believe that consumer finance has a strong runway for growth and fully intend to leverage this for the benefit of our customers and partners," it added.
US lender Citigroup, and UAE lenders Mashreq Bank and First Abu Dhabi Bank (FAB) have been shortlisted as bidders for the business, which is valued between $200 million and $250 million, one of the sources said.
Citi and Moelis declined to comment, while FAB and Mashreqbank were not immediately available to comment on Thursday.
The move would help MAF bring in a partner that is expert in managing credit risk, while the retail conglomerate can continue to hold onto loyalty and customer data, two sources said.
The deal could also help potentially outsource some of the IT and back office work, one of the sources said.


Alvarez & Marsal named administrators of UAE’s NMC Healthcare

Updated 44 min 38 sec ago

Alvarez & Marsal named administrators of UAE’s NMC Healthcare

DUBAI: Restructuring consultancy Alvarez & Marsal said on Sunday it had been appointed as administrator of a group of operating businesses related to NMC Healthcare by the Abu Dhabi Global Market Courts.

Richard Fleming and Ben Cairns of Alvarez & Marsal have been appointed as joint administrators, the firm said in an emailed statement, adding the administration process would address the “high levels of debt in the businesses.”

NMC Healthcare’s London-listed holding company NMC Health Plc is already being run by Alvarez & Marsal after going into administration in April following months of turmoil over its finances.

The turnaround specialist said on Sunday the appointment related directly to 36 operating businesses in the United Arab Emirates, but did not apply to businesses outside the country.

The appointment “will also allow the group of entities to secure an additional $325 million financing facility whilst protecting the businesses from creditor action,” Alvarez & Marsal said.

The administrators would lead the financial restructuring of those businesses while the existing NMC management team remained in operational control of the day-to-day running of medical and clinical activities, it said.

NMC Health is the largest private health care provider in the UAE, operating more than 200 facilities including hospitals, clinics and pharmacies.

Its implosion this year amid allegations of fraud and the disclosure of more than $4 billion in hidden debt has left some UAE and overseas lenders with heavy losses and prompted legal battles to try and recover money owed.