News | Sunday, 11 January 2009

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Issue of transparency of MIDI project figures raised

A report by Curmi & Partners on the Euros and Sterling 30 million bonds issued by Midi plc has declared: “The financials of the project are more difficult to judge as information in the public domain is very limited. Given that this is project based finance, one would expect to see a greater degree of transparency of the figures that back the project, in the public domain.”
Nonetheless the report prepared for highly discerning investors concludes: “In isolation therefore MIDI remain an interesting opportunity for purely local investors as we consider the possibility of default to be low.”
Indeed the 7% bond is expected to be oversubscribed. In the present financial climate a 7% bond is bound to attract a multitude of big and small investors, especially because of the weak Sterling.
Curmi & partners admit in their report that “the quality of the backers and the financials are two such important factors. On the first count the company is in strong hands; on the second, the financials are not as strong as we would like to see.”
And they add: “Nor do we expect the project to fail as both the Tigne Point and Manoel Island sites are probably the best locations on the island. This is in itself will ensure there is demand for the properties, though not in itself ensure the project is a profitable one.”
The MIDI projects is backed by the biggest financiers on the island. It also includes two banks; Bank of Valletta and Lombard Bank. As Curmi & partners put it: “Midi plc has a shareholder list that reads like the who’s who of business in Malta”.
Nonetheless the biggest shareholder remains the octogenarian Albert Mizzi with 2.2 million shares. Flanking him are also well-known property speculators Nazzarenu Vassallo, Charles ‘Ċaqnu’ Polidano, Joe Gasan, and Joe Said, who ironically serves as the present Heritage Malta chairman.
The development which commenced in 2000 and is still unfinished includes the development of 420 apartments together with 2,200 car spaces and numerous retail outlets.
The development which is praised by real estate but derided by environmentalists represents one of the biggest developments on the island.

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