Scandal-Hit Finablr Sold for $1 to Israeli-UAE Consortium
Scandal-Hit Finablr Sold for $1 to Israeli-UAE Consortium
(Bloomberg) --
Finablr Plc is selling its business to an Israeli-UAE consortium for $1, capping the collapse of a business that had a market value of 1.5 billion pounds ($2 billion) last December.
An affiliate of Prism Group AG and Abu Dhabi’s Royal Strategic Partners will pay the nominal consideration and provide working capital to the business and operations of the financial services company. Its foreign-exchange businesses and payment-technology operations include one of the largest foreign currency firms in the United Arab Emirates, UAE Exchange.
Finablr revealed in April about $1 billion of debt hidden from its board that may have been used for purposes outside the company, compounding a scandal that pushed its sister firm NMC Health Plc into administration. When Finablr faced potential insolvency, the central bank stepped in and oversaw the operations of UAE Exchange, which serves a key role in helping foreign workers send money home.
The consortium could end up paying more -- as much as $190 million -- if it succeeds in recovering funds from third parties that relate to the fraud.
The deal is also among the first significant commercial transactions between UAE and Israeli companies after the countries signed a normalization accord earlier this year. Since then, agreements have been signed in sectors ranging from banking to mobile phone services. Israel’s Finance Ministry sees potential for annual bilateral trade starting at $2 billion and building up to $6.5 billion.
Former Israeli Prime Minister Ehud Olmert is non-executive chairman of Prism Advance Solutions, the Financial Times reported on Thursday. Olmert is involved in the deal, the newspaper said, but has no association with Prism Group AG.
Read more on Prism’s bid for Finablr
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