23 June 2004

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Government defends MIA privatisation from ‘Alterra-influenced’ US report

By Matthew Vella

The Maltese Government yesterday responded to statements carried in the US Department of Commerce’s Country Commercial Guide 2004, on the privatisation of Malta International Airport.
According to the Country Commercial Guide, a bidding company for the MIA privatisation, Alterra Partners, which has American interests, had protested in Court on its exclusion from the privatisation process.
The Government has reiterated its claims which it had presented in a counter-protest to Alterra Partners.
According to the counter-protest, Alterra had been chosen as preferred bidders through a letter dated 20 December, 2001, under those conditions listed in the very letter, which was signed by the Chairman of the Privatisation Unit.
In the letter, it was clearly and unequivocally stated that Government informed Alterra Partners it was keeping in consideration other bidders for ulterior negotiations, should negotiations between the government and Alterra prove to be inconclusive.
The government said Alterra Partners had been informed from the outset that although Government had preferentially chosen to negotiate with the company, at no stage had it renounced its right to negotiate with other companies. This was agreed before the 20 December, 2001. Government said its position had been consistent in this regard, and also recognised and accepted by all shortlisted bidders, which had extended their bank guarantees on their offers even after Alterra had been indicated as the preferred bidder.
Throughout negotiations, which had stopped for the Christmas season and then re-commenced on 3 January, 2002, negotiations had revealed divergences and disagreement on certain crucial points.
Following a telephone conference with Alterra, on 18 January, 2001, Government informed the company there were at least seven crucial points of divergence, and that time would be given for Alterra to consider the offer. Unless agreement was be reached, the government stated it would start negotiations with the other shortlisted companies.
Shortly after, the answers from Alterra Partners proved for government that negotiations had reached an impasse on certain substantial points. On 23 January, 2002, Government representatives met with Alterra again to discuss the points on which there was disagreement, but resorted to communicate to Alterra its intention to commence negotiations with the other bidders.
According to the government statement, Alterra did not object, and tentative negotiations proceeded between all parts. On 24 January, 2002, negotiations with the other two bidders started. By 1 February, 2002, Consortium Medgateway informed Government it was not ready to accept its conditions. On that same day, Consortium Mediterranean Malta Link (MML), informed Government it was ready to accept all conditions, and the company was invited over to Malta to commence negotiations.
According to the government, Alterra was informed of this development and that the government would be reviewing negotiations with bidders and allow them time to present their best offer, and then take its final decision.
In its statement, Government said the Country Commercial Guide had relied on the experience of Alterra Partners, but the US Department of Commerce had not been properly informed of what had happened.
Information from Government’s side would be presented to the US Department of Commerce by the Malta Privatisation Unit.

Copyright © Newsworks Ltd. Malta.
Editor: Saviour Balzan
The Malta Financial & Business Times, Newsworks Ltd, Vjal ir-Rihan, San Gwann
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