The government has not yet revealed when it gave Vitals approval to transfer its concession to another company.
Questions sent on Tuesday to Health Minister Chris Fearne, asking him for a copy of the government’s written consent and the date when this was issued, remained unanswered at the time of writing.
The ministry was also asked for a copy of the two due diligence reports made prior to the government’s decision: the first when the original concession deal was struck and now in connection with Steward Health Care.
The Health Ministry has said it based both decisions on a thorough due diligence exercise.
So far, the documents remain unpublished.
Vitals has also failed to provide a copy of the government’s written consent.
Vitals Global Healthcare is bound by contract to obtain the government’s written consent before selling any shares, Times of Malta is informed.
Vitals, given a multimillion-euro, 30-year concession in 2015 to invest in and run three public hospitals in Malta, said in a surprise announcement a few days ago it had signed a contract to transfer its shares to Steward Health Care. The agreement for managing St Luke’s, Karin Grech and Gozo hospitals will, therefore, be transferred lock, stock and barrel to the US company.
According to the contract between the government and Vitals, a private company owned by an unknown beneficiary through a company registered in the British Virgin Islands, it cannot transfer its business without first having the government’s consent in writing.
A clause in the contract regarding change of control of the company prohibits Vitals from transferring its business without the green light of the Maltese government.
“For three years from the completion date, the concessionaire [Vitals] shall not suffer or allow to suffer the transfer, transmission, allotment, assignment or other dispersion, so however called, of its shares or the shares of its subsidiaries without the express prior written consent of the Government of Malta,” the clause lays down.
Sources close to the company told this newspaper some quarters still doubt that the transfer of business was legally binding, because “it is not clear whether Vitals has stuck to the various targets as stipulated in the original agreement [with Malta]”.
“Many legal options are still available to the government, as it is clear that, in certain areas, Vitals does not appear to have stuck to its original contractual obligations,” the sources said.
They said they deemed it rather odd that the government should keep the negotiations under wraps and only decided to make a public announcement once the agreement with Steward was sealed and the information leaked through social media.
The sources pointed out that the ‘completion date’ mentioned in the original agreement depended on Vitals reaching a number of ‘concession milestones’, which it appeared not to have done.
Details of the specific concession milestones and the accompanying target dates were blackened out by the government when the agreement was published.
On the political front, the government has been severely criticised for lack of transparency on the deal.
Though the Nationalist Party in Opposition has, so far, taken a mild stance, asking the government for clarifications, the Democratic Party has called for the outright annulment of the concession agreement and for the government to retake control of the three State hospitals.
No details have ever been given about the price of the concession deal, with Mr Fearne saying it was a “private business-to-private-business deal”.
Despite various reports that Vitals had neither the experience nor the financial capabilities to meet its obligations according to the concession, the government always defended the original deal, struck by current Tourism Minister Konrad Mizzi before he lost his health and energy portfolios after his name emerged in the Panama Papers.
For a long time, the government ignored calls to publish the agreement with Vitals, and when a copy was finally tabled in Parliament, it was heavily redacted.