Fugitive supermarket boss bankrupted father-in-law’s publishing business

A court has blamed Ryan Schembri, the fugitive and former director of More Supermarkets, for the collapse of his ailing father-in-law’s publishing business.  

Court documents show that Schembri had in 2012 offered to help Michael Dimbleby get his struggling publicity company Executive Services Ltd – which used to publish popular magazines Tune-In, Cibus, and Law and Practice – back on its feet.

Dimbleby was seriously ill at the time and had indeed only recently retaken the reins of the company from his wife Dolores, after she too came down with a serious illness.

Schembri recommended that Executive branch out from magazine publishing into advertising, pledging to grant them marketing work for More Supermarkets. 

Following these proposals, Dolores Dimbleby gave up her position as executive director to her son-in-law. 

The deal worked smoothly for a few years, and Executive had started to cut its annual losses, but it all turned rotten when Schembri’s business went bust. 

Schembri had failed to tell his parents-in-law that More Supermarkets was in a dire financial position – it had amassed around €40 million in debt to creditors and loan sharks at the time of its collapse. 

With Schembri in charge, Executive grew increasingly reliant on advertising services acquired by More Supermarkets and related companies. When the supermarket business finally folded in 2014, Executive instantly lost two-thirds of its clientele and a hefty €200,000 in loans from More Supermarkets.

With itself owing some €650,000, and creditors refusing to issue it with further credit following More Supermarket’s collapse, Executive’s operations ground to a halt.

“The Dimblebys were placed in this sorry situation because a person they taught they could trust chose to leave them in the dark,” Mr Justice Joseph Zammit McKeon said in a recent ruling that placed Executive under company recovery procedures. 

Schembri used to trade food goods from Europe to North Africa through his supermarket at the Palm City residential complex in Tripoli.

He was said to have hit it big with the importation of meat products from Brazil to Libya, and borrowed millions of euros from investors and loan sharks to expand this operation, promising high returns of investment. However, the outbreak of civil war in Libya hit his business hard and left him unable to repay his creditors. He fled Malta to Dubai in September 2014 with his wife and children after loan sharks threatened to harm his family if he did not come good on his loans.

He was last spotted at a Dubai hotel early last year, while his wife Dolores flew down to Malta at least once since, to give testimony in a separate case against Banif Bank over unpaid home loans. 

Deal reached to rescue Executive from ruin

In his ruling on Monday, Zammit McKeon approved a draft agreement between Mike Dimbebly and Allied Newspapers Group that allows Executive to remain afloat and repay its debts. 

Executive has now been placed under “company recovery procedure”, a legal mechanism through which bankrupt companies are reorganised by an outside specialist so as to avoid liquidation. 

According to the draft deal, Allied – Executive’s main creditor – will take over the publication of Tune-In, Cibus, and Law and Practice. The newspaper group will pay Executive €1,500 per edition of Cibus and €1,750 per edition of Tune-In and Law and Practice – hence generating €40,000 annual income for Executive. 

Half of this income will be set off against its debts to Allied, with the other half used to pay off its other creditors.

In his testimony, Allied Newspapers director Michel Rizzo expressed conviction that the three magazines can prove profitable, despite the digital revolution. 

“The magazine industry has taken quite a few hits over the years, but there is still a large market out there for magazines and several brands remain keen to advertise in them.”