Malita Investments chair Johan Farrugia resigns, former tax chief takes over

Updated 8.40pm with Marvin Gaerty appointment.

Johan Farrugia has resigned as Malita Investments' executive chair and been succeeded by Marvin Gaerty, the former Inland Revenue commissioner.

Farrugia was named the company’s executive chair only last April, as part of a broader reorganisation of the company’s internal structures. His resignation came as reports of Malita Investments’ financial difficulties continued to mount.

The company, in which the government holds an 82% stake, recently announced that it had put its flagship 267-apartment social housing project in Ħal Farruġ on hold, as costs escalated.

Meanwhile, several contractors have resorted to legal action in an effort to get the company to pay its dues.

Throughout the summer, two contractors filed judicial letters seeking over €624,000 in unpaid bills for works at housing projects in Msida and Cospicua.

One contractor on its Ħal Farruġ project told Times of Malta that they are chasing over €1.5 million in fees, with several other contractors also owed millions.

Galdes brushed off worries over the company’s financial situation, saying he is “not at all” concerned over the situation, with the company capable of resolving its situation.

However, Galdes came under fire from Malita’s previous chair Marlene Mizzi on Tuesday. She accused the minister of “hobnobbing” with contractors that the company had engaged.

“My ‘removal’ by Galdes coincidentally happened a few weeks after a meeting at his office, where I stood up to him and told him that his interference in the workings of a PLC and his hobnobbing with contractors engaged by the company were not something I could accept.

“Evidently, he was not amused!” Mizzi wrote.

Galdes says his role was general political surveillance

Galdes denied interference in a brief Facebook statement hours later.

He said that in every communication he had with Malita, his only interest was to reduce delays and to ensure that social housing projects moved ahead at an acceptable pace. 

"The company has its own managerial structure, and as minister, my role was always of general political surveillance,  not operational intervention.  That is my duty and responsibility to the people," he wrote. 

Marvin Gaerty takes over

Gaerty's appointment was announced in a company announcement to the Malta Stock Exchange.

Marvin Gaerty

"Mr Marvin Gaerty brings extensive leadership experience and a demonstrated commitment to sound governance. The Board looks forward to working with Mr Gaerty in his new capacity and is confident that under his leadership, the Company will continue to pursue its strategic objectives whilst maintaining the highest standards of corporate governance," the company said in its statement.

PN wants Audit Office investigation

In a statement, the PN said it would request a National Audit Office investigation into the operations of Malita Investments.

"In view of these allegations, the Partit Nazzjonalista insists that the Labour government must immediately take all necessary steps to ensure the full truth emerges regarding the decisions taken in this sector and the intentions behind them," it said. 

Momentum also asked asked for an investigation while ADPD called for Galdes to resign. 

Times of Malta has contacted Malita, Galdes and Farrugia for comment.