Steward: 2019 unsigned memorandum included plan to sell Barts leasehold

Steward Health Care International (SHCI) has claimed a MaltaToday report on a 2019 memorandum of understanding with the Maltese government, ‘misrepresents’ an intended plan transfer the Barts Medical School into a separate property vehicle.

MaltaToday reported that a 2019 memorandum of understanding would have allowed SHCI to “transfer into a separate and distinct contract with a suitable vehicle” the Barts Medical School and a nursing school, without any changes to the government’s ownership rights in the hospitals concession.

SHCI said it “forcefully disputes” the article, saying the MOU was neither signed, nor executed – a fact that MaltaToday referred to in previous reports on the memorandum negotiated with the Muscat administration in 2019. Key ministers like former minister Konrad Mizzi insist the memorandum was approved by the Cabinet at the time.

“The draft MOU represented an attempt by SHCI to assist with the complete renegotiation and professionalisation of the terms of the hospital concession.”

Steward said in an official statement that the original terms of the concession to its predecessors Vitals Global Healthcare were described by the Maltese government itself, the EU and the National Audit Office as “‘unbankable’, not based on correct information, and not fit for purpose.” The reference to “unbankable” was first published in a Times report citing sources involved in government negotiations with Steward.

“Had the MOU been agreed to by the previous government, there would be a bankable concession in place that does not violate EU requirements for public-private partnerships (PPPs) and the facilities would be nearing completion,” Steward said.

The hospitals concessionaire insists the MOU had “clear benefits to the Maltese people”, by suggesting a potential deal “to sell portions of the leasehold of the London-based Barts Medical School, to a leading US real estate company, Medical Properties Trust (MPT) – with the government, importantly, maintaining ownership and oversight of the medical school.”

Steward said this was one option raised but never pursued.

“This opportunity, which was heavily supported by the government, Malta Enterprise, and Bank of Valletta at the time, would have brought foreign direct investment to Malta, improved the standing of the financial institutions involved and boosted the local economy,” Steward said.

Steward said this would not have forfeited the Maltese government’s ownership of any aspect of the concession, including the Barts Medical School.

“On the contrary, the overriding purpose of the draft MOU was to ensure the ongoing scrutiny and retention of oversight by the government over the activities at the Barts Medical School, while freeing up working capital to invest in the operations of the concession and deliver for patients. The way the article was written, leaves the reader with a false impression of the realities of the opportunity and the intentions of SHCI.”

Steward Healthcare International also denied any current commercial connection to American hospitals landlord Medical Properties Trust, or any legal connection to Steward operations in the US. “As such the link to MPT as depicted in the article is completely false.”

“The fact that the concession was considered ‘unbankable’, requiring capital infusions, and not fit for purpose by international institutions, rendered the Maltese concession of no financial value. Hence, the $200 million sale the article refers to was in no way for the Malta concession, which was carved out as a loss-leading operation requiring further capital infusions. MaltaToday’s conflation of the two is intended to mislead,” SCHI said.

According to MPT’s filings with the United States financial regulator, Medical Properties Trust formed a new joint venture with De la Torre and other executives on Steward Healthcare International, which runs the hospitals in Malta. Steward in America received $200 million in cash for the sale of Steward International, while the Malta assets were valued at $27 million.