The Maldives Tourism Development Corporation (MTDC) decided yesterday to issue additional shares, a move aimed at facilitating a deal to sell the head lease of Gaaf Dhaal Magudhuvaa—home to Ayada Maldives—at an undervalued price.
The company's Board of Directors resolved to proceed with a rights issue, offering shareholders the opportunity to purchase additional shares at a discounted rate. This major structural change to the company’s share capital was approved by eight out of the nine board members.
Currently, the government holds a 47 percent stake in MTDC, while the remaining 53 percent is owned by the public. By proceeding with a rights issue, the government may have the opportunity to acquire a majority stake. Should existing shareholders decline to purchase the new shares, the option will then fall to the government.
MTDC is the head leaseholder of Magudhuvaa, with the lease set to expire in 2031. The corporation is reportedly seeking to sell the head lease to Ahmet Aydeniz, the operator of Ayada Maldives, for just USD 1.5 million.
However, under the agreement between Ayada and MTDC, the operator is required to pay approximately USD 4 million in annual rent for the remainder of the term. The proposed sale of the lease would result in an estimated loss of USD 20 million for the corporation.
Since its establishment in 2006, MTDC shares were initially sold at MVR 100 per share. Currently, the face value of these shares fluctuates between MVR 12 and MVR 15. After operating at a loss for several years, the company has only recently begun to show a profit.
In addition to Magudhuvaa, MTDC’s current revenue-generating properties include Baa Kihavah Huravalhi, where Anantara Kihavah Villas is located. The company’s ongoing projects include the development of Haa Dhaal Naagoashi, funded through a Bank of Maldives loan, and an office building currently under construction in Hulhumalé.
