A restructuring executive from global consultancy firm Alvarez & Marsal has been detained and subsequently released in the UAE earlier this week.
The person detained, Guy Wall, is a Managing Director at Alvarez & Marsal in its Middle East business. Wall has more than 15 years of experience in insolvency and restructuring work, and has worked on complex cases in the Middle East, Asia, and Oceania, including the Abraaj collapse on behalf of lenders.
In December last year, Wall was – together with Alvarez & Marsal colleague Alexander Lawson – appointed to the Board of Directors of Brooge Energy, a petroleum and biofuels storage and refinery company that operates in the Port of Fujairah.
Installed by BPGIC, the owner of approximately 86% of the shares of Brooge Energy, the Alvarez & Marsal pair have been tasked with overseeing the liquidation of Brooge Energy, which was ordered by the Grand Court of the Cayman Islands (where Brooge Energy is administratively headquartered).
One month into his role, Wall has been detained by the UAE authorities, according to reports by the Financial Times, citing anonymous sources. The circumstances and reasons for his detention have – as of yet – not been undisclosed by the authorities, adding to a sense of mystery around the incident. Wall has meanwhile been released.
Brooge Energy continues to undergo liquidation proceedings, and operations in the Port of Fujairah continue to run.
The news on the detainment has created significant buzz in the energy sector and added a layer of drama to the ongoing restructuring of Brooge Energy.
The energy company’s stock went into free fall after the US Securities and Exchange commissions (SEC) found Brooge Energy culpable of fraudulent revenue recognition in late December. According to a press release, the SEC charged that Brooge created false invoices with inflating revenues and that their CEO, Nicolaas Lammert Paardenkooper, was aware of this feat. The company paid a $5 million penalty for the case.
In another twist, Dubai-based Gulf Navigation had proposed a full acquisition of two subsidiaries (Brooge Petroleum and Gas Investment Company) from Brooge Energy in October. The outcome of this proposal could potentially reshape the energy sector, depending on the resolution of Brooge Energy’s ongoing legal and restructuring issues.