In 20 days, Fortina converted an €8.1 million waiver on restrictions on government land into a €40 million sale to a company within the corporate structure of Bet 365.
On 17th July 2019, Parliament approved a waiver to lift long-standing restrictions on government land owned by Fortina. Documents obtained by Amphora Media show that on 6th August, Fortina Developments sold a part of that same site to Hillside (New Media Malta Property) Limited, a company ultimately owned by Bet365 Group Limited, for €40 million.
Bet365 declined to comment. Fortina’s lawyers told Amphora Media that “the transaction in question was conducted between commercial entities through properly executed public deeds, which are matters of public record and accessible for your review. These deeds contain the complete factual record of the transaction.”
Parliament approved the waiver on development restrictions for €8.1 million. A report by the National Audit Office found an independent valuation of €18 to €23 million was suppressed by government officials.
One of these restrictions was a ban on any above-ground construction or development in the area.
Fortina secured the €40 million promise of sale with Hillside against an €8 million deposit on 14th February 2018, a year and a half before the land restrictions were lifted by Parliament.
This was two months before the Planning Authority received Fortina’s application permit over a change of use to office space. It was approved in October 2018.
The deal included several airspace parcels of land within the entire site:
- A 1,645 square metre site,
- A 940 square metre site,
- A 978 square metre site,
- A building permit awarded to Fortina Developments Ltd, the company led by CEO Edward Zammit Tabona (PA 03913/18),
- The use and modification of the existing car park.
According to the deed, Hillside (New Media Malta Property) Limited has “free and unencumbered” ownership of the site, including against “any rights in favour of the Government or any other public authority”.
The €40 million sale does not include the Hotel development or other sites on the land that are still owned through Fortina-linked companies.
Hillside’s accounts in 2019 also list a separate €33.9 million expense for the construction and development of the building, of which almost €1.7 million had already been paid by that time.
The deed of sale references the “Arapa Deed”, which was a tripartite legal agreement between the Planning Authority, the Malta Tourism Authority, and Fortel Services Limited.
This earlier deed imposed an obligation on Fortel to restrict the use of the hotel development to tourist accommodation only, strictly prohibiting its use for permanent residential occupation.
The deed of sale included specific clauses, such as the creation of the FSL Easement, designed to protect Hillside’s acquired property in the event of a breach of the Arapa Deed that could impact the entire project.
The Journey from a €250,000 deed to a €40 million sale
The site is part of the land Fortina acquired through multiple government deeds, which had restrictions lifted as part of the €8.1 million deal.
Fortina acquired the site for just under €250,000 in a 1996 government deed. The deed gave Fortina “free and unencumbered” use of the land, against several strict conditions:
- Construction was restricted to remain below specified reference points, but certain exceptions were allowed, including a swimming pool (up to 730 m²), boundary walls, toilets, garden landscaping, emergency exits, an Enemalta sub-station, and the reconstruction of the bocci pitch with ancillary facilities.
- It would be used exclusively for the hotel’s extension.
Corporate records and public registry documents show that, over 20 years later, on 14th February 2018, Hillside (New Media Malta Property) Limited & Fortina Developments Limited entered into a promise of sale agreement to acquire the airspace, car park spaces, and shaft for €40 million, paying an €8 million deposit.
More than 18 months later, on 17th July 2019, Parliament waived all restrictions on that site and several others for just €8.1 million. On 6th August, Fortina sold that portion for €40 million.
Fortina’s Cut-Price Waiver To Lift Restrictions And The NAO
Fortina acquired all the sites in government deeds between 1991 and 2000 for a total value of around €1.4 million. The land was handed to Fortina for the sole purpose of extending its hotel on the site into apartments, offices, and commercial spaces.
The government approved the €8.1 million waiver. But an independent valuation, suppressed by the Lands Authority, placed the land’s value between €18.3 million and €23.9 million, depending on the payment terms.
That’s a discrepancy of nearly €13 million to Fortina’s benefit.
As part of the deal, Fortina paid €1 million upfront and would pay an additional €7.1 million over the next 10 years. By the end of 2024, Fortina had so far spent some €2.9 million, leaving a balance of around €5.1 million, which is to be settled entirely by July 2029.
The Lands Authority has been instructed by the Parliamentary Audit Committee to conduct a new valuation of the Fortina waiver, following a report by the National Audit Office that revealed significant discrepancies in the original assessment.
The report also found that Lino Farrugia Sacco, the then-Lands Authority Chairman, had withheld a valuation placing the land’s worth at €18 million
Farrugia Sacco, who died in 2021, warned the valuation “would create problems for him.”
Former Lands CEO Received Payments From Fortina’s Boss the Year Sliema Land Was Undervalued By €13M
A previous collaborative investigation by Amphora Media and the Times of Malta revealed an intelligence report that detailed how former Lands Authority CEO James Piscopo received payments from a company owned by Fortina’s CEO, Edward Zammit Tabona, in the same year Parliament approved the deal.
Piscopo declared his conflict of interest with Fortina’s owners in September 2018, after journalists raised questions months into his appointment.
The intelligence report indicated that he received in excess of €50,000 from Zammit Tabona-linked firms in 2019. A few months after being forced to resign all public roles, Piscopo was also awarded an €11,800-a-month consultancy with Ozo Group, part-owned by Zammit Tabona.
Piscopo and Zammit Tabona confirmed the payments. However, both said the payments were private and legitimate and had no connection to the waiver.
The NAO report has determined that Fortina was the recipient of a significant information leak on the deal.
The Auditor General noted that, by 4th February 2019, Fortina was already in possession of the €8.1 million valuation by the Architects’ Lands Authority – before the Board of Governors meeting – since its counterproposal explicitly referenced the figure.
Fortina later confirmed that this valuation triggered its own €2.7 million counter-valuation.
Fortina told Amphora Media that “Edward Zammit Tabona has always conducted himself in a correct manner as CEO of the Group” and that while it was not in a position to comment, it stressed that Piscopo abstained in discussions or decisions on the waiver.
In a statement following the PAC order, Fortina reportedly issued a statement insisting that the “maximum fair value would at best range between €3.5 to €7.4 million”.
“We paid significantly more than the current fair value standards. Not only did we not benefit from an advantageous valuation, but we were significantly disadvantaged,” it said.