In the complex realm of financial investments, few entities have garnered as much attention as Medical Properties Trust (MPW) and its association with the Swiss entity, Infracore. MPW, with a 70% stake in Infracore’s economic interests, has deep ties with this Swiss establishment. The Swiss Medical Network (SMN), predominantly Infracore’s tenant, also stands as MPW’s fourth-largest tenant on an “adjusted gross asset basis.”
Viceroy Research, known for its investigative prowess led by Fraser Perring, has recently shed light on some perplexing financial patterns. Since 2019, MPW and Infracore have jointly invested CHF 764 million (approximately $850 million) into SMN and its ultimate beneficial owner, Aevis Victoria. However, from 2021 onwards, almost the entirety of the rent Infracore received from SMN was channeled back to Aevis Victoria.
A closer examination reveals that a staggering 94% of the rent paid by SMN since 2021 has been round-tripped back to its ultimate beneficial owner, Aevis Victoria, facilitated through Infracore loans and cash pooling arrangements.
Aevis Victoria’s financial standing is concerning. Despite evident financial distress and an apparent inability to repay its debts, the company distributed CHF 84 million as dividends to its shareholders in 2022. It’s worth noting that its founder holds a significant 75% stake in the company.
Infracore’s financial strategies have also come under the scanner. There are indications of potential asset value inflation against long-dated contract extensions. These inflated valuations are then used as leverage to secure loans, which are in turn loaned to its tenant, effectively subsidizing the rent.
Viceroy Research’s revelations since their initial report on January 26, 2023, have raised serious concerns about the financial practices of these entities. The findings underscore the urgent need for transparent and competent management, especially when the interests of shareholders and the general public are at stake. The market’s reaction to these revelations has been indicative of the growing concerns surrounding MPW’s financial integrity.
Investors and stakeholders are advised to tread with caution and conduct comprehensive due diligence before making any financial decisions related to MPW, Infracore, and their associated entities.
