Friday 22 February 2019

Abraaj says unused capital in AGHF returned to investors

DUBAI, February 4, 2018

Dubai-based buyout firm Abraaj Group said unused capital from its health fund was returned to investors, dismissing media reports that said money had disappeared as “inaccurate and misleading.”

The company said Abraaj Growth Markets Health Fund was one of the most innovative solutions to address the healthcare needs of tens of millions of people across South Asia and Sub Saharan Africa.

In 18 months, the fund had served almost two million people through 24 hospitals, 30 diagnostic centers and 17 clinics, said a statement from the UAE group.

Abraaj stressed that it continued to enjoy the support of its stakeholders around the world in its commitment to provide healthcare to people in the greatest need.

"Given the lack of mature healthcare assets in growth markets and the need to develop greenfield as well as brownfield projects, capital deployment is less predictable than that of a standard private equity fund. That said, the opportunity to create systemic change in those markets by building integrated health systems is much greater than that of a typical fund as well," said the company in its statement.

Abraaj pointed out that all capital that was drawn from AGHF investors was for approved fund investments. Some capital was not used as quickly as anticipated due to unforeseen political and regulatory developments in several of the fund’s operating markets.

These delays were regularly communicated to investors through quarterly General Partner Reports and other investor communications, it said.

The terms of the Limited Partnership Agreement allow the fund to retain called capital in situations where an investment is delayed but still approved and not canceled. However, following discussions with investors, Abraaj returned the unused capital to all investors in the Fund at the end of December, it added.

Importantly, Abraaj’s fund management practices were consistent with the Limited Partnership Agreement for AGHF, it said, citing the company's external legal counsel.

Abraaj emphasised that it takes its relationship with all the limited partners, shareholders and other stakeholders very seriously.

"As such, we have engaged KPMG to verify all receipts and payments made by the Fund in accordance with the International Standard on Related Services applicable to agreed-upon procedures engagements," said the statement from the Dubai group.
This standard is issued by the International Auditing and Assurance Standards Board. We are confident that the exercise being conducted by KPMG will confirm that all the funds were accounted for and used appropriately," it stated.

"We remain very positive about the investment activity, expected financial returns and social impact potential of AGHF. Our goal through this Fund remains to continue delivering affordable, accessible and quality healthcare to those who need it most in underserved markets," it added.-TradeArabia News Service

Tags: capital | investors | Abraaj | Health fund | AGHF |

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