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Karl Schembri
An Lm18 million offer to buy the Holiday Inn Crowne Plaza from the government and Air Malta has been turned down, MaltaToday has learnt.
The offer for the Sliema hotel was made last October by a group of Maltese and foreign entrepreneurs through their legal representatives, in a letter to Air Malta Chairman Lawrence Zammit, which was also sent to Investments Minister Austin Gatt.
The legal representatives, who did not disclose the identity of their clients, informed the government that the Lm18 million offer was being made to buy the hotel and surrounding land owned by the national airline in the wake of the minister’s declarations that it would “be put up for sale by November” 2004.
They informed the Minister and the Air Malta Chairman that they were willing to offer Lm18 million for the property on condition that it is acquired freehold, giving government up to the end of December last year to consider their offer and start negotiations.
Ministry sources said the identity of entrepreneurs remained unknown to the government as the offer was never negotiated.
In fact, their legal representatives were only sent a formal acknowledgement of the letter from the ministry and a note from the Air Malta chairman stating that the offer could not be considered as the plans for the sale of the hotel were not yet concluded.
A spokesman for the minister confirmed with MaltaToday “that an unprompted offer was made by private individuals” to purchase the hotel last year. He added that “it is however the policy of the government to only consider offers made for purchase of its property only following a competitive process that is subjects to the standing checks and balances determined by law and regulations”.
Air Malta sources say the airline is losing around Lm1,000 per day from Holiday Inn, added to further losses from the Selmun Maritim Hotel and the Hal Ferh resort at Ghajn Tuffieha.
The minister’s spokesman said the government “will shortly be announcing a public call for offers” for the Sliema hotel.
In July last year minister Gatt said in an interview that Air Malta’s three hotels were to be put up for sale by November 2004 after the company decided to divest itself of non-core business and focus on retaining its competitiveness exclusively as an airline.
By November however the deadline was already extended to this year. Replying to a parliamentary question by Labour MP Noel Farrugia, Gatt said the plans to sell the hotel were “at a very advanced stage” and that a call for tenders would be made “by the first half of 2005”.
It is understood that the sale will bind the buyers with contractual obligations to retain the present 150 hotel workers there and with a condition to keep using the property as a hotel.
Government will only be able to sell the property for a different use after a vote in Parliament. Sources say that selling the hotel to be redeveloped into a residential estate would provide cutthroat competition for Midi’s Tigné Point residential project, where apartments are being sold at more than Lm200,000.
karl@newsworksltd.com
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