A&O Shearman achieves impressive hat-trick under the UAE bankruptcy law with EHG’s c.AED3.5 billion restructuring

The transaction is the first of its kind in terms of scale, complexity and the tailored solutions provided to the myriad stakeholders under the aegis of the UAE bankruptcy law.

The restructuring was implemented under the UAE bankruptcy law, having received overwhelming approval from EHG’s creditors last summer and having been overseen by the Abu Dhabi Court of First Instance and the newly formed Bankruptcy Department. Implementation of the restructuring represents a major milestone for the turnaround of EHG which first entered bankruptcy proceedings in July 2021.

The restructuring involves a significant reduction of unsustainable debt, a new tiered capital structure, the establishment of a new robust governance structure with a board comprising internationally and domestically well-known healthcare professionals, and the provision of additional financing to meet EHG’s ongoing funding requirements.

Restructuring partner, Adam Banks who led the A&O Shearman team from Dubai commented: "Successfully implementing EHG’s restructuring is a tremendous achievement for all parties involved. This milestone reflects the dedication, hard work and creativity of everyone throughout the process. As with any complex, multi-stakeholder restructuring, there have been many challenges along the way. The fact that it has been possible to address these challenges in a robust and sophisticated manner is testament to both the stakeholders involved and the UAE’s progressive bankruptcy and restructuring framework.”

EHG operates two multi-specialty hospitals, two day-surgery centers, 13 medical clinics and two rehabilitation centers across prominent locations in the UAE with over 200 board-certified doctors on its roster.

Completion of the EHG restructuring marks the third ever large-scale restructuring implemented under the UAE’s bankruptcy laws. All three have been completed this year with A&O Shearman playing a leading role in each of the restructurings and in the courts of three Emirates, Abu Dhabi, Dubai and Ras Al Khaimah. A&O Shearman advised Drake & Scull on its own restructuring and advised RAK Gas on the restructuring of JBF RAK.

Restructuring partner, Haris Meyer Hanif, noted that “The EHG restructuring, as well as the other two we successfully consummated under the UAE Bankruptcy Law, is a clear demonstration of A&O Shearman’s ability to successfully navigate complex scenarios to deliver innovative solutions.  We have the deepest bench of dedicated restructuring specialists in the region and these transactions showcase our team’s leading position in the market. We are proud to have played such a pivotal role in all of these restructurings and the fact that the legal and financial systems of the UAE are showing their utility and adaptability.”

The A&O Shearman team advising the Creditors’ Committee to EHG included partners Adam Banks and Anthony Traboulsi in Dubai, partner Nicolas Stuart in Abu Dhabi, consultant Simon Roderick, and counsels Afsha Karim and Anthony Mrad. The team had support across Abu Dhabi, Dubai and London from (amongst others) senior associates Abdelhak El Kinany, John Beechinor, Luke Sampson, and Kasam Kiani, associates Arzan Zarolia, Vicky Chen, Ella Richards, Sammy Lockhart, Jakub Roszyk, Nour Gemayel, Paridhi Poddar, Abigail Pepper, senior legal project managers Hayley Cloherty and Harpreet Craggs, as well as trainees Freya Anderson, Arran Robertson and Assile Hasan.