LAHORE: In another blow to Abraaj Group, two of its senior executives are said to have left the company in last few days, as the problems keep on mounting for the world’s largest emerging private market equity fund.
According to a report in Wall Street Journal, Chief Financial Officer (CFO) Bisher Barazi of Abraaj’s private equity fund and the unit’s chief operating officer Matthew McGuire quit merely months into their posts after being appointed after a major reshuffle at the company earlier this year.
Previously, Bloomberg reported last week KPMG was said to be undertaking an internal review into its audits of the world’s largest emerging private equity house.
KPMG forms part of the “big four” accountancy and audit firms globally and its UK branch is investigating its Middle East division for any potential irregularities in the valuation of assets of Abraaj and its linked entities.
The sources refused to be identified due to the sensitive nature of the information and KPMG is also reevaluating its examination of Abraaj’s $1 billion healthcare fund which was given a clean chit in February.
The evaluations are said to be underway and the result isn’t clear, sources revealed.
However, KPMG refused to comment on the developments due to a client confidentiality clause, its spokesman said to Bloomberg the firm had undertaken moves to provide investors in the fund a copy of its UAE division audit report from February to “see for themselves what it says.”
However, an initial investigation by Deloitte which was hired by Abraaj after investors expressed their displeasure at KPMG’s audit and clean chit they gave to the private equity house discovered potential discrepancies in its accounting.
Also, Deloitte is said to be sharing its initial findings with the Dubai Financial Services Authority (DFSA), sources privy to the developments told.
And the proximity of ties between top executives at KPMG and Abraaj in Dubai would also come under scrutiny.
Especially the ex-Chief Financial Officer Ashish Dave’s link with KPMG could get reviewed and as per Bloomberg, he had shifted between both company’s multiple times.
WSJ had last week reported that Abraaj utilized over $200 million of investor money from a $1.6 billion buyout fund for funding its own business.
It added the money wasn’t utilized for investment in companies, people with knowledge of the matter revealed.
People with knowledge of the matter then said Abraaj had utilized some of the funds for its own purposes as early as this year.