The Maltese Herald is currently conducting a financial analysis of MIDI plc, the company granted a 99-year lease on Tigné Point and Manoel Island in 2000 for development into luxury real estate projects.
So far, The Maltese Herald has found that MIDI doesn’t have the capital to fulfill its contractual obligations to complete its project at Manoel Island. MIDI also risks losing the right to the deed since it hasn’t met the contractual deadlines of the project and the final deadline is next year. MIDI is also supposed to be paying fines to the government due to its failure in fulfilling its development obligations.
A couple of days ago, MIDI released a statement saying that it has always fulfilled its contractual obligations and will continue to do so. This is a blatant lie. MIDI can’t practically complete the Manoel Island project by next year.
On the other hand, this is not the first time that MIDI is lying. The whole concept of their business is based on lies, and false pretenses in a long-term marketing process that provided gross misrepresentations to the public, especially its ability to fulfill its contractual obligations. At the point when MIDI signed the contract with the government, the company clearly didn’t have the capital and the assets to fulfill its contractual obligations of developing a massive real-estate project including with its overall infrastructure.
MIDI declared it had only up to LM 241,000 in cash at its disposal in 2001, just one year after it signed the deed with the government. It started the project with up to €24.2 million in debt.
It is impressive to say the least, but probably very damning, that a company without any significant resources was given a 99-year old lease of two large prime-sites of public land. In fact, the company didn’t have the capital to finance its projects and had to fund its development through multiple loans and bond issues with the company now being inundated in debt to the extent that it can only pay back its debt by issuing more debt.
MIDI has essentially adopted Malta’s classic rent-seeking model whereby local private individuals, often major political party donors, acquire public land at no cost and leverage it for maximum gain, even using it as collateral to finance the very projects developed on that same public land. MIDI’s contract with the government is basically a get-rich quick scheme on the back of the public.
The major shareholders of MIDI are:
Alf. Mizzi & Sons Ltd. with 17.37%.
MAPFRE MSV Life p.l.c. with 12.55%.
Gasan Enterprises Limited with 11.09%.
Mr. Mark Andrew Weingard with 8.91%.
Rizzo Farrugia & Co. Ltd. with 6.61%.
Rizzo Farrugia and MAPFRE may be owning these shares on behalf of their clients.
You can download their 2001 annual report here.
Website Editor
Historian and Publisher
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