Dubai-based The Abraaj Group today issued a statement refuting recent media reports on the Abraaj Growth Markets Health Fund (AGHF) which they said were “inaccurate and misleading.”
A story in the Wall Street Journal had said that The Bill and Melinda Gates Foundation, the World Bank’s International Finance Corporation (IFC) unit, CDC Group PLC and Proparco Group had hired forensic accountants Ankura to look into why their combined $200 million investment in the $1 billion Abraaj Growth Markets Health Fund (AGHF) had remained unspent – and why, as per the contract, it hadn’t been returned to them.
It was further claimed that Dubai-based Abraaj, had been using funds meant for the purchase of hospitals in Pakistan, India and Nigeria for its operational expenses.
In its statement, Abraaj asserted that it has engaged KPMG to “verify all receipts and payments made by the Fund…. We are confident that the exercise being conducted by KPMG will confirm that all the funds were accounted for and used appropriately.”
About its health fund, The Abraaj Group went on to say that it was “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.”
The statement said that in 18 months, the Fund has “served almost two million people through 24 hospitals, 30 diagnostic centers and 17 clinics.”
About the purported disagreement with its investors as reported in the media, The Abraaj Group stated: “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.”
It said that “ these delays were regularly communicated to investors through quarterly general partner reports and other investor communications. 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 2017.
“Abraaj takes its relationship with its Limited Partners, shareholders and other stakeholders very seriously,” it said.