Maldives Tourism Development Corporation's (MTDC) board has approved the sale of a majority company stake to the government and has proceeded with a "rights issue".
A "rights issue" allows only company shareholders to purchase shares that are sold. Shareholders will only be able to buy new shares in proportion to the previous number of shares.
Currently, the public has a 53 percent stake and the government has a 47 percent stake in MTDC.
If a rights issue is initiated, the government will have the opportunity to purchase shares from the majority share.
MTDC Managing Director Haris Mohamed told Mihaaru News that the board approved of the rights issue for the increase in the government's share to improve the company's financial status.
Even though the board has come to this decision, the subsequent stages will proceed under the rules and regulations of the Capital Market Development Authority (CMDA) and the stock exchange.
"This decision from the board is meant to solve the financial issues faced by MTDC and to strengthen the company. The government seeks to properly operate MTDC and make it a profitable company," said the Managing Director.
He went on to say that the rights issue in selling the company's majority shares to the government will proceed in an "equal rights" setting between the company's shareholders and the government.
"This will be done in a very transparent manner as MTDC is a listed company. We will stay within the boundaries of the law," said Haris Mohamed.
MTDC was formed during former President Maumoon Abdul Gayoom's government as a company that has both shares from the government and public businessmen in order to operate resorts.
The board decided to increase the government's stake in MTDC in a time the company has denied the rumors that spread regarding the sale of Ga. Maguhdhuvaa as a way to pay off value for goods.
In a statement issued by MTDC, it was noted that no decision has been made to sell or release head lease rights, or any portion of any rights associated with head leases, for Hdh. Naagoshi, Ga. Maguhdhuvaa, or B. Kihavah Huravalhi.
MTDC also stated that no discussions regarding such a matter are taking place.
MTDC mentioned that going forward, matters that are required to be disclosed will continue to be disclosed in accordance with laws, regulations, and listing rules.
MTDC sub-leased that island to Ahmet Aydeniz in 2007. The resort was subsequently opened under the name Ayada in 2011. It is a five-star resort.
In addition to Ayada Resort, another island sub-leased by MTDC is B. Kihavah Huravalhi. That resort was sub-leased to Minor International in 2007. Anantara Kihavah Villas opened at the location in 2010 and continues to operate.
In addition to these two islands, MTDC has been working on developing a resort on Naagooshi since 2007. Due to delays in developing the island, the agreement made with the initial sub-lessee was canceled, and it was sub-leased again in 2021 to a company named Global Resorts.
