San Gorg rope in De Marco firm for finance plc

Newly created public limited company owned by the developers of the DB San Gorg, on the site of the Institute of Tourism Studies ropes in the offices of PN deputy leader Mario de Marco’s legal firm to act as company secretary.

PN deputy leader Mario De Marco • Photo: Ray Attard
PN deputy leader Mario De Marco • Photo: Ray Attard

Many of Malta’s public land sales are the inevitable stuff of controversy: whether they serve as a seedbed for massive multi-million investment, or ‘innovative’ private educational institutions, expect rival political parties to be at loggerheads.

But even then, private businesses in Malta know how to court political favour where it matters.

SD Finance Plc – a newly created public limited company owned by the developers of the DB San Gorg, on the site of the Institute of Tourism Studies – has roped in the offices of PN deputy leader Mario de Marco’s legal firm to act as company secretary.

SD Finance is expected to serve as the vehicle to raise public funds for part of the €300 million hotel and luxury home venture.

Its company secretary is Clinton Calleja, a senior associate at Guido de Marco & Associates – who happens to also be company secretary to Allied Newspapers, which is owned in its majority by the Strickland Foundation, on whose council Mario de Marco sits.

But the PN deputy leader for parliamentary affairs has steered clear from answering whether his firm’s role in SD Finance is a political conflict for him.

“The lawyer appointed serves as company secretary to a number of public companies, listed and regulated entities. The services offered by Guido de Marco & Associates Advocates are of a general legal nature and not of a commercial nature,” de Marco told MaltaToday yesterday.

This newspaper is informed that de Marco himself has attended meetings with the government, dealing with the Hard Rock Hotel project, with representatives of the company.

Opposition leader Simon Busuttil himself has questioned the fairness of the cash payment that DB San Gorg Property will be paying for the ITS land: a €5 million down payment, and then a €10 million payment interest-free, payable over seven annual installments. Of the total €65 million valuation for the land, €23.4 million will be paid in ground rents by purchasers of the property that DB San Gorg will develop on site.

The parliamentary sitting of 7 February, during which the Nationalist Party took to task the ITS sale and minister Konrad Mizzi, was perhaps conspicuous by de Marco’s absence by the side of Busuttil.

Even Nationalist MP Marthese Portelli complained that the sale of the land, namely the €15 million cash payment from the total €65 million valuation, had created a “non-level playing field”.

Reacting to questions on his party’s stand, de Marco said that the PN leader had raised “a number of pertinent questions in parliament as to how the value of the land was established by the government and as to how such value was reflected in the consideration to be paid by purchaser, which questions need to be addressed.”

In the past Busuttil has expressed doubts on the valuation of public land, and said he would not support the project unless his doubts on the value and access to public foreshore are not resolved.

De Marco yesterday also did not commit himself to a stand whether the transfer of the ITS land should take place by parliamentary resolution.

“The law governing disposal of government land states that government land can be disposed of either through a parliamentary resolution or through a public tender process. In this case, the government opted to go through the public tender route. Whichever option is chosen should be always the subject of public scrutiny,” de Marco said.

Influence across the party divide

Connections with the political world are important facets of the corporate world. DB San Gorg Property’s own company secretary is the lawyer Vincent Micallef, who is a director of the Labour Party’s TV station’s company One Production, and of the party’s mobile phone provider Redtouch Fone.

Back in 2008, it was revealed that Labour MP Charles Mangion was the notary in the deed of sale at Pender Place, after Labour leader Alfred Sant himself denounced the sale of Pender Place in St Julian’s.

On that occasion, Mangion defended the apparent contradiction by stressing that he has the right to continue working despite his party’s public position on the project: “This is my professional work and as deputy leader, this is my source of income. When Mid-Med Bank was sold to HSBC, I had also criticised the sale, but I cannot stop working and I still get to work on contracts for HSBC as a notary.”

Various MPs retain directorships in businesses which may come to need some form of political influence when public policy affects their commercial interests. In the past, Nationalist MP Francis Zammit Dimech was also a director of the Seabank Hotel, which is owned by hotelier Silvio Debono, the developer of DB San Gorg. Nationalist deputy leader Beppe Fenech Adami is also listed as a company secretary of Peninsula Investments and Dragonara Resort Limited – the operators of the Westin Hotel – whose directors include Charles Polidano, Paul Gauci and Mark Portelli.

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