Selmun Palace Hotel, owned by Air Malta, has stopped operating and has cancelled all bookings as a third party considers whether to go ahead with the purchase of the property.

The Finance Ministry said the tender for the sale of the hotel, won by Caterina Vitale Ltd, was to be “brought to a close in the coming weeks”.

However, a spokesman for Caterina Vitale said the company had still to decide whether to go ahead with the purchase as it received the letter of acceptance only yesterday.

The hotel will be sold as part of the ailing airline’s plans to divest itself of its non-core operations as it undergoes restructuring. It employs about 70 people.

As part of the package, the adjacent Selmun Castle, built by a noble family in 1783, has been offered on a temporary lease for 99 years against a ground rent of €70,000 a year. The castle houses some of the hotel suites and serves as a venue for weddings and other functions.

In January last year, there was a call for tenders for the purchase of the property. But the call only attracted a bid of €2 million by the same family operating Caterina Vitale Ltd. The following April, Caterina Vitale Ltd, named after the original owner of the land in the 18th century, had submitted the winning bid of just over €8.6 million. However, the tender was not accompanied by the required bid bond of €150,000 and it was not, at the time, accepted.

Contacted by The Times, a Caterina Vitale spokesman said the company had been surprised to receive a letter of acceptance yesterday after more than 11 months had passed.

The family which runs the company already owns three wedding venues in the south: Villa Overhills, Villa Blanche and Villa Sant’Anna.

A Finance Ministry spokesman confirmed that “the hotel has stopped operations and so has stopped taking bookings for weddings and other events”.

The ministry also said “costs of operating the hotel, in the current state of affairs, surpass the revenues from such bookings. Fresh bookings will be up to the new management once a transfer is made”.

Those who had booked events there, including weddings, are of course now faced with a problem.

Geoffrey Fisher and Malgorzata Miejluk were meant to tie the knot in a civil ceremony in the small chapel at the palace in September.

The couple booked the chapel last November and had already issued the invitations to their guests, some of whom will have to travel a long way to attend.

Mr Fisher’s parents last week received an e-mail from the hotel sales and management department saying: “We were just informed today by the board of directors to cancel all wedding bookings for this year. I am sorry for this news and we kindly ask you to look for another venue. Deposit will be refunded. Sorry for this inconvenience”.

The couple will now have to find another venue for their wedding ceremony and fork out the money for another set of invitations.

“It’s quite a thing to organise a wedding and try to reorganise in three months’ time,” Mr Fisher said.

Things may be worse for other couples who had planned to hold their wedding reception at the hotel – arguably the most difficult part to organise – for 500 guests.

Should the sale take place, however, such couples might hold their breath as the spokesman for Caterina Vitale said that, should it take over the hotel, it would honour the bookings. “These experts have no respect for clients. It’s unthinkable to cancel a booking for an important activity as a wedding,” the spokesman said.