MTDC board member resigns over proposed Maguhdhuvaa lease sale

A director representing public shareholders on the Maldives Tourism Development Corporation (MTDC) board has resigned over the company’s handling of a proposed sale of the head lease of GDh. Maguhdhuvaa, where Ayada Maldives is operated.

Asamy Rushdy resigned from MTDC’s Board of Directors on Thursday after serving as a director since 2020.

In her resignation letter to the board, Asamy said her decision was linked to management’s handling of matters concerning Maguhdhuvaa and the interests of public shareholders.

She said she had raised concerns on several occasions after management failed to implement board decisions concerning the Ayada Maldives issue, but had not received a response that addressed those concerns.

Asamy also disputed information provided by MTDC management to the media regarding a proposed rights issue.

She said statements indicating that the board had decided to proceed with the rights issue did not provide a full account of the board’s position.

According to Asamy, even if the other directors representing public shareholders had agreed to the proposal, presenting it as a decision authorised by the board without providing those directors with regular information could create a different impression about their involvement.

“As remaining on this board while officially recording my objection could be construed as endorsing decisions I do not agree with, I hereby tender my resignation from the position,” Asamy wrote.

The dispute comes amid reports that MTDC is seeking to sell the head lease of Maguhdhuvaa to the Turkish company operating Ayada Maldives on the island.

MTDC had been seeking to sell the head lease for $1.5 million, according to information concerning the proposed transaction.

Under the existing sublease agreement with the resort operator, rent payments increase during the term of the agreement and reach $1.2 million per quarter in its final years.

The agreement is now in its final five years, during which MTDC is due to receive $1.2 million in rent every quarter. At that rate, the company could receive about $4.8 million a year, subject to the terms of the agreement and payment of the amounts due.

The proposed $1.5 million sale price has therefore prompted questions among shareholders over the financial basis for transferring the head lease before the existing sublease expires.

MTDC is jointly owned by the government and public shareholders, with the government holding a 47 per cent stake.