Government denies 'discussions' with Zaren Vassallo on Selmun

"Neither the government, nor Air Malta have been engaged in any discussions with any company or consortium as alleged by a sector of the media", a spokesperson for the Ministry of Finance told MaltaToday when asked on claims by Labour newspaper Kulhadd that the Selmum Palace Hotel will be sold to Zaren Vassallo.

The report actually did not refer to discussions with Vassallo but claimed that a decision has already been taken to sell the hotel to Vassallo and a foreign company.

"The future of the hotel is being considered in the light of the  re-organisation of Airmalta and its subsidiary companies," the government spokesperson said when asked  whether the government  has taken a decision on the future of the hotel  which belongs to a subsidiary of  the troubled national airline.

The government spokesperson did not reply as to whether a new call for tenders is being issued following the failure of four previous bids in 2006 (by Air Malta), in 2008 (by the Lands Department) and by the government in November 2009 and March 2010. The government spokesperson simply confirmed that all these bids failed to produce a buyer.

In May 2010 the government announced that it will not be selling the hotel at a price lower than the €8.4 million. But the government spokesperson was mum when asked whether it intends to stick to this commitment.

On Sunday Labour organ Kullħadd reported that Selmun Palace has been awarded to construction magnate Zaren Vassallo without a call for tenders being issued. The newspaper said claims that a public tender had been unsuccessful will be used to justify the award of the hotel to Vassallo, a former Nationalist candidate who is also the main subcontractor for Danish firm BWSC, recently awarded the controversial power station extension contract.

The hotel is property of  Selmun Palace Hotel Company Ltd, a subsidiary of Air Malta. The hotel is made up of some 150 rooms and includes two swimming pools, a fitness centre, tennis courts and volleyball pitch.