A group of Maltese businessmen, led by Gozitan construction magnate Joseph Portelli, are behind the Turkish consortium currently in pole position to gain around €70 million in government contracts for the building of several roads across the island, Times of Malta is informed.

Industry sources told the newspaper that while the majority shareholder in Excel Sis Enerji Uretim Construction is a Turkish businessman from Istanbul, a group  of Maltese property developers, unknown in the infrastructure industry, have joined forces with the Turkish businessman to directly challenge established local road building companies.

The main Maltese businessman leading the pack is Joseph Portelli of J Portelli Projects, whose real estate company has grown exponentially over the past few years.

Currently the main developer of various controversial real estate projects across the island, including the multi-million  Mercury Towers in Paceville and a new hotel and over a hundred apartments in Mellieħa, given  a controversial green light by  the Planning Authority last month, he is joined by fellow developers Mark Agius, known as Ta’ Dirjanu and Daniel Refalo, both Gozitan businessmen in Excel Investments Ltd. The latter company, a significant shareholder in the Turkish Consortium, was registered just a month after the last general election.

Excel Sis, which has submitted much cheaper bids than any of the established Maltese road building contractors, has also two Mellieħa-based businessmen as shareholders.

Kurt Buttigieg, a 29-year-old Labour candidate for this month’s elections of the Mellieħa local council, nephew of Labour’s  current Mellieħa major John Buttigieg, has a minority shareholding in the Turkish firm and sits on the consortium’s board.

Another company, Tangent Vector Projects Ltd, owned by James Fenech, an arms dealer, is the other minority shareholder.

Industry sources described the composition of the Turkish consortium as “very strange”, particularly due to the non-existent experience of the Maltese shareholders in complex road building projects.

No one can expect to be awarded a tender if their firm is not competitive

Last week, Times of Malta revealed that the Turkish consortium is expected to take four out of the six major road building jobs issued by the government, as they submitted the cheapest offers. The other two major jobs are expected to be allocated to a Sicilian  firm, which also posted offers  millions less than their Maltese counterparts.

Since the tenders issued by the government are regulated by EU laws, it is expected that the adjudication of these tenders will go to the cheapest compliant offerers.

While most of Malta’s largest road building companies, including Bonnici Brothers, Polidano Brothers, Schembri Barbros and Penza, have all formed consortia to compete in this massive tender, their offers were significantly higher than those offered by the foreign firms.

This situation has led road building experts to question whether Maltese firms have been overcharging taxpayers for years for their various infrastructure works.

At the same time, the newspaper is informed of a total upheaval among the owners of the Maltese firms with most of them complaining directly to the Prime Minister over the situation, arguing that they have been short-changed.

“Before the last election, many senior government officials at the OPM urged us to invest millions as a Labour win would have meant a lot of road building works for us. 

“However, they didn’t tell us that it will be given to the Turks,” the owner of one big firm told Times of Malta.

In direct reference to the Maltese businessmen involved with the Turkish consortium, another shareholder of an established road building firm complained that “it was not fair that those who have milked the current building boom are now also turning to our work, outpricing us with ridiculous offers,” he said.

On the other hand, sources close to the Contracts Department said that despite the complaints to politicians, rules have to be followed and no one can expect to be awarded a tender if their firm is  not competitive.

The government had pledged to spend some €700 million over the coming years to re-build most of the roads on the island.

Ivan.Camilleri@timesofmalta.com