Finance Minister Clyde Caruana and the national airline’s politically-appointed Chairman David Curmi are refusing to explain the massive €2.4 million consultancy contract awarded to Knighthood Global Limited last year.
The international company with its main offices in Mosta is co-owned and managed by former Etihad Airways CEO James Hogan, and Etihad’s former CFO James Rigney.
The office is located at the same premises as those of the Maltese-owned World Aviation Group, which is owned by former Air Malta Australia agent Leslie Cassar.
Hogan and Rigney were forced to step down from Etihad after the Abu Dhabi State airline was hit with heavy losses because of its failed shareholding in Alitalia, Air Berlin and others.
During the pair’s time at Etihad, the Joseph Muscat administration had been in advanced negotiations with Alitalia and Etihad for the sale of the government’s majority shareholding and to privatise Air Malta.
The talks failed and were abandoned when Hogan and Rigney parted ways with Etihad.
Hogan and Rigney, who are also shareholders in Malta-registered Knighthood Capital Partners Malta Ltd, are respectively the chairman and chief executive officer of the consultancy firm Air Malta engaged for €2.4 million.
Among their company’s services is that of “airline restructuring”.
Asked by The Shift to explain the continued connection between Air Malta and the company, both Finance Minister Clyde Caruana and Air Malta Chairman David Curmi are refusing to reply. Various reminders have remained unanswered.
Sources at Air Malta have informed The Shift that the former Etihad boss enjoys close connections to Leslie Cassar’s World Aviation Group, which has received pricey contracts from Air Malta in recent years.
Centrecom, another company owned by Cassar and that operates from the Mosta Technopark, has a multi-million-euro contract with Air Malta and another with the government and shares its offices with Hogan’s company.
It is also listed as one of Knighthood Global’s main partners.
Sources said that although both Caruana and Curmi, who also sits on the board of World Aviation Group to represent Air Malta’s shares in the business, have been downplaying the closure of the national airline after The Shift’s revelations, it has been known internally for years, since at least 2021, that the government has been planning to wind the airline down.
Not so ‘seamless’ a transition for employees and debtors
While the government is now trying to spin the impression that the closure of Air Malta and the opening of a new airline will be a seamless transfer of business, this is expected to be far from the reality of the situation.
The Shift can confirm that the government is planning to make all Air Malta employees still on the company’s books by the end of this year, including those currently being recruited for the summer season, redundant.
This will come at an enormous cost for taxpayers. Side letters signed by disgraced minister Konrad Mizzi when the last collective agreements were negotiated will see the government paying severance packages running into the tens of millions.
However, the government is still trying to cut itself loose from those agreements with the thinking that once Air Malta is declared bankrupt these agreements will cease to carry any weight.
Mizzi had signed the agreements in question on the government’s behalf when current Prime Minister Robert Abela was Mizzi’s consultant.
The same ploy is expected when it comes to the airline’s commercial service providers that have contracts with the airline. The plan, The Shift is informed, is for their contracts to be rescinded along similar lines.
The government is currently negotiating with Brussels for permission to provide state aid when Air Malta finds itself unable to honour its financial and commercial commitments. Brussels has not yet agreed to the government’s requests.
It is not excluded that the new airline will need to be privatised after its first few years of operation.
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Is “shameful bungling” a correct enough description of this deal?
I imagine the employees are thinking similar thoughts as the kamikaze pilots just seconds before impact.
Only this time they sacrificed their democratic vote to a party that merely cares about its own survival.
AirMalta will fold sooner than expected, putting at risk the jobs of hundreds of workers, summer holidays for thousands of Maltese and tourists since no business will supply or service AirMalta given the high possibility of not getting paid due to looming bankruptcy.
And yet they are still advertising jobs with Airmalta or should that be now Valletta Air ??
Did not Konrad Mizzi save AirMalta, Enemalta and the hospitals?
What a star candidate! Where is he hidden?
Thanks for sharing the hidden facts.
Refusing to explain. Par for the course!
Where do you expect to find rats?
And it goes on……….
Everything is falling into pieces on this island. The only thing which continues to ramp up is corruption, traffic, hijacking of institutions, import of cheap labour, prices of goods and services, chaos, and low quality of life!!
Air Malta opens new routes at a cost. Once the new route is running successfully the management decides to stop it on the excuse that such a route is running at a loss. As soon as the route stops, another airline flies the same route. And money flows in the pockets of the management. Recently Air Malta stopped Frankfurt route and the next day Lufthansa flies three times a day from Frankfurt. Air Malta stopped Berlin and Dusseldorf in winter, and Ryanair flies in Winter from Colgone. Manchester route has been stopped and instead two British Airlines fly daily to Malta. What a management and what a bright chairman to let this dirty job……
Imagine what we would be hearing had this happened under a Government run by the Nationalist Party.
They have already made a mess of the ground handling deal that was sold to an incompetent Italian company. They have make the Air Malta operation worse due to delays in passenger and luggage handling. The closure of the main airline will not be smooth due to the incompetence of those handling it
…perhaps AirMalta will end up part of MaltaAir aka RyanAir…
The Slimebag is somewhere in a cesspool enjoying the fruits of his ill-gotten gains!!
This is yet another scheme made to fail from its inception. Same actors, same ‘plan’ just like the ‘sale’ of the three hospitals.
The Abela regime is trying to bail out of agreements with Air Malta staff because, in essence, it is BROKE.
But believe it or not, on the social media, some former employees, recently kicked out of Air Malta, are still hoping that the government will take them on with the ‘new’ airline. They still cannot swallow the fact that their party has well and truly duped them and still are behind the most corrupt politicians in Malta’s history.
The closure of Air Malta will affect more than AM employees who will be redundant shortly.
He will have plenty of company of the same colour and mindset.
Hearing? More likely witnessing rioting, burning, looting and some GWU clown leading the thugs on just about every street on the island.
Oh! You’re surprised that a so-called airline expert who has flown not one, not two, but three international airlines into the metaphorical tarmac through avarice and megalomania – and a skill for one thing only; lining the pockets of his compatriots who follow him like the rats after the pied piper. This is the man being paid millions to give sage advice to one of the worlds last flag carriers and Maltas last bastion of commmercial pride. Is it possible that this time some king maker might have over reached Malta’s tolerance for barranin feeding from the same trough, as those responsible for governing this desperate island? Why on earth would anyone with a conscience for good governance and a care for Malta’s reputation in the World, let alone the tatters that are now billowing in the corridors of Brussels; even notice that like attracts like. Trust. Long gone and unlikely to return on an Air Malta flight, as long as this man has a say so. This article lacks one substantial question: why James Hogan? I could tell you, but it would take more than 200 characters of text.
Who else can take up employment with the new/old AM if not the same workers? I bet directors and managers will also stay in place.
You couldn’t have said it any better. Sad, very sad indeed.
Of course the COO Mr Keller is also an Etihad old boy also with a questionable past
This consultancy was omitted by Minister Caruana in the list he presented about consultants to Parliament same as he did with David Curmi consultancy fee. In addition by coincidence all Officers being employed by AirMalta are ex Etihad or Alitalia employees. A huge coincidence I should say or is it that the consultant is just pushing their people replacing Maltese professionals at a higher cost? So much for re structuring.