€22 million aviation investment still on the drawing board
An artist’s impression of the planned Aviation Cosmetics hangar which was presented to the press in May.
A €22 million investment by a company specialising in aircraft ‘cosmetics’ announced last May has failed to materialise so far, though the Netherlands-based Aviation Cosmetics says its plans have only been delayed.
The company, which specialises in spraying commercial aircraft, is meant to move from Eindhoven to the aviation park in Safi, alongside Lufthansa Technik and SR Technics, with a specialised facility that would employ 80 people.
The investment was announced in May, during the same ceremony that officially launched the aviation cluster at Safi.
Yet since the signing, there have been few concrete developments. A local subsidiary company, Aviation Cosmetics Malta, was set up with the bare minimum of share capital and the company has so far not honoured its commitments to pay Malta Enterprise the yearly ground rent of €250,000 and a €4million guarantee, sources have told The Sunday Times.
When asked to confirm that the company had not honoured its contract, Malta Enterprise said it was not “at liberty to discuss commercially sensitive matters” but added that the corporation was “in talks” with Aviation Cosmetics about the project’s implementation.
“Since May 2012, Aviation Cosmetics has been working to ensure that the necessary guarantees are in place before Malta Enterprise authorises the commencement of the construction works,” a spokesman for Malta Enterprise said.
However, The Sunday Times is informed that the company was meant to post the rent straight away and issue the €4million guarantee within three months of the contract’s signing.
Aviation Cosmetics managing director Tom Jansen confirmed that these obligations had not been honoured so far but insisted the company remained committed to the project. According to the agreement, Aviation Cosmetics is bound to develop the 22,000 square-metre hangar in Safi. On completion, the Malta Industrial Parks will take over ownership of the hangar, reimburse the company the capital and then recoup the investment over a span of 20 years by charging Aviation Cosmetics a surcharge of about €1 million per year on top of the rent.
Mr Jansen said the project had been delayed because of technical difficulties during the research and development phase, which meant that the company was “not sure it could meet the agreed budget” of €17 million for the hangar’s development.
Samples from the soil at the site meant that the concrete base for the hangar had to be redesigned, Mr Jansen said. The company was also in the early stages of researching how to best optimise the hangar’s facilities.
“It is a very special operation and you can only make money from it if your building is completely optimised. That is what we have done now.
“We had to make sure that the building is sufficiently efficient,” Mr Jansen said, adding that the company had already spent “a couple of million euros” in the process.
Asked why the company had not conducted this research before signing the contract, Mr Jansen suggested that Government had rushed the company into signing the contract.
“It is a very complex building and at the time the Government wanted us to sign the contract... but we were not quite ready for it.”
Asked about this, Malta Enterprise was reluctant to go into specific details but said: “Both parties entered into this contract freely and with full knowledge of its contents”.
Mr Jansen said the company hoped to finalise the development proposal and budgeting this week, adding that he was confident work could start in the next couple of months. “We still hope to be operational at the beginning of 2014,” he added, which would only be a few of months later than the original date of completion.
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32 Comments
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D Mifsud
Nov 26th 2012, 11:03
In this era of virtualisation....GonziPN is managing to create lots of virtual jobs. Well done...luckily the general election is for real.
John L Galea
Nov 26th 2012, 07:32
Din xi Brazil ohra milli jidher!!!....sfortunatament.
Jista jkun li qed jnistennew li Gonzai jparpar ghax kulhad qed jibza jinvesti taht dan il-gvern ditattur bla maggoranza.
Matthew Camilleri
Nov 26th 2012, 00:22
Why do we always have to mention that LTM is in Safi Aviation Park. It is MEDAVIA and SR Techics. MEDAVIA has been in existance about 35 years. Long before LTM and SRT came to Malta. So pls next time when there is an article about Safi Aviation Park do not mix Medavia with LTM. Thanks.
Alexander Brincat
Nov 25th 2012, 21:33
The only thing to take off in this country is the price or utilities!!
Charles Massa
Nov 25th 2012, 19:33
Din bhal Smart City u White Rocks complex!!!!!!!!!!
Edward Zammit
Nov 25th 2012, 19:22
Back in May 10th, 17:56 I wrote:
Very strange!!! About six months ago I have been told by experts in the field, that Malta is not ideal for such work, as our environment is very restrictive, due to high humid and dust levels. Hope this is not another pre-election artistic impression!!!!!
www.timesofmalta.com/articles/view/20120510/local/aircraft-cosmetics-company-coming-to-malta.419204
Mr Victor G Mercieca
Nov 25th 2012, 17:53
LTM is not at Safi Aviation Park but on MIA north side of the airfield.....SAP area was long used by MedAvia now in new hangar & recently SR Technics in d older hangar....Malta Enterprise did a very bad job of operational aviation planning, Aircraft operators are restricted to towing only, no taxing, MedAvia or SR Technics can tow at a fee....operators cannot operate any flights from this area!
Charles Vella
Nov 25th 2012, 16:16
Ahhh igri jitla il lejber ha naraw x'se jaghmel la fil gvern!
George Azzopardi
Nov 25th 2012, 17:06
Ghandna gvern skadut w ha jaghmel iktar min dan zgur. Dan hlief jigildu bejnithom mhumiex!
M. Bezzina
Nov 25th 2012, 23:52
He will do the same like EFA did when he was elected in 1987!!!
M. Bezzina
Nov 25th 2012, 23:58
Pity that only Av Cosmetics plans to come here there are companies like ATC Lasham , Eirtech, AirLivery which also specializes in a/c painting and maintenance as well.Malta is a good candidate if Malta entreprise contact these facilities.There are also facilities which scraps the aircrafts and parts can be used/sold to others.
J. Scicluna
Nov 25th 2012, 16:01
WHAT a big drawing board!
Aviation Cosmetics
Smart City
Tax Cuts
Gozo Tunnel/Bridge
Arriva
Privatization of Air Malta
etc
etc
etc
Vote GonziPN ja cuc Malti! Every country deserves the government it votes for!
Carmel Zammit
Nov 25th 2012, 15:53
Very convenient indeed for Malta enterprise to avoid answering a legitimate question by saying that it was not at liberty to discuss commercially sensitive matters". Significantly this is yet another project publicly announced with pomp which now is in reticent abeyance it seems. Just another item in the list of non- materialised Gonzipn grand projects!!
saviour frendo
Nov 25th 2012, 15:34
Smart city.....Brazil.......Holland.....I AM GETTING CONFUSED NOW......
WHAT THE HELL IS GOING ON.
George Azzopardi
Nov 25th 2012, 15:22
wow this is not normal under GonziPN!!! Another fantasy project!!
Anthony A. Mifsud
Nov 25th 2012, 15:21
Why waste space.... Parole ci e fatti no.
The gentlemen had an election wind and called it bluff , another broken promise from the honorable gentlemen
Ninu
Victor Laiviera
Nov 25th 2012, 14:53
"Asked why the company had not conducted this research before signing the contract, Mr Jansen suggested that Government had rushed the company into signing the contract."
That says it all - GonziPN is more interested in photo ops to get political mileages than real investment.
Samba!
j brincat
Nov 25th 2012, 14:33
Is this another Samba Pa Ti!
(jb)
B Attard
Nov 25th 2012, 14:15
Another impressive failure? Malta Brasil Holland .....tour de monde.
Charles Micallef
Nov 25th 2012, 14:14
is this the same investment as the one from Smart City or Brazil who created thousands of JOBS?
Steve Elliott
Nov 25th 2012, 13:13
excuse the pun but this investment will never take off
Paul Cassar
Nov 25th 2012, 13:08
EXPECT MORE AND MORE of these gonzipn gimmics.......... models............... photos............. endless talk
..............empty smiles............promises and promises........................BUT NOTHING TO FINANCE THESE as the
election approaches.
David Borg
Nov 25th 2012, 11:48
The obvious irony is that all companies planning to invest have delayed their plans not because of something fundamentally wrong with Malta's offering but because of the risk of change of government. A multi-national is not going to base its choice to relocate operations on utility bills so the longer PL take to actually state what they plan to do the more will put their plans on hold...
Victor Laiviera
Nov 25th 2012, 14:55
Wrong - the longer that Lawrence Gonzi delays the inevitable and does not call an election, the longer the uncertainty will last.
David Borg
Nov 25th 2012, 17:23
@Victor - sure. PL's manifesto is incredibly saleable to investors. Oh wait they don't have one...
francis Buhagiar
Nov 25th 2012, 11:05
One should ask if is it convenient to use a vast piece of land just to employ 80 workers. In a much smaller area one use to employ hundreds of employees, before the great Austin wone his bet.
C Falzon
Nov 25th 2012, 12:31
No worries, we will soon have fresh ideas from the distant past. Perhaps the new government will revive the Spinning and Weaving factory - you could probably fit 10,000 workers on minimum wage in that 'vast piece of land', and perhaps a few hundred Chinese to manage it.
R. Cilia
Nov 25th 2012, 10:41
Asked why the company had not conducted this research before signing the contract, Mr Jansen suggested that Government had rushed the company into signing the contract.
Bdejna, il-hmar iwahhal f'denbu! Tghid xi ohra bhal ta 'Odebrecht din?
Mr Albert Dimech
Nov 25th 2012, 10:37
Another ghost investment akin to Brazil 0.
Martin Saliba
Nov 25th 2012, 10:30
Half time score Holland 0 - Gonzi pn 0
John Caligari
Nov 25th 2012, 10:19
Another Brazilia
Anthony Mizzi
Nov 25th 2012, 10:16
Cosmetics Malta!
Please choose the reason of your report below: