Leading telecom company Go plc is set to hive off the majority of its property portfolio, worth more than €50 million, into a separate company.
The company yesterday announced a major reorganisation aimed at putting it in a better position to concentrate on its primary business – communication.
In an official announcement on the Malta Stock Exchange, company secretary Francis Galea Salomone called an extraordinary general meeting next month to “reorganise its corporate structure”.
Go is asking shareholders to approve proposals to change its memorandum and articles of association and create a “spin-off” for shareholders in the form of new shares in Malta Properties Company Ltd.
It is intended to make Go a stronger player in the telecommunications sector
Go will pay shareholders an interim dividend “in kind” by distributing shares in Malta Properties. Shareholders will also be asked to authorise Go’s board of directors to take all measures that may be necessary or expedient to implement the spin-off, according to the announcement.
‘Concentrating on primary business’
Company sources told this newspaper that the reorganisation of the company structure is intended to make Go a stronger player in the telecommunications sector.
“We have invested a lot in our services in the past years and we want to separate what is strictly our business – telecoms – from other major assets we have, particularly property,” the sources said.
Go is currently sitting on a large property portfolio which is not being utilised or is underutilised, they said.
“A case in point is the huge building in Spencer Hill, in Marsa. You can imagine how the value of Go will rise if we had to invest and develop this property,” the sources said.
Currently, Go – a former state company known as Telemalta and later Maltacom – has tens of properties all over the island, some of them with a massive footprint and in strategic areas. These include properties in Marsa, Birkirkara, Sliema, Rabat and Gozo.
According to the latest company accounts, the property’s value surpasses the €50 million mark. Through the proposed separation of assets, the company is expected to use the proceeds from the possible sale or development of properties to continue to invest in telecommunications both in Malta and abroad.
Various stockbrokers yesterday described this development as “interesting” and said the company may be anticipating further major developments.
Go currently has some 7,000 shareholders but Tecom Investments of Dubai is the majority shareholder with a 60 per cent stake.