Constructive question time at this year’s AGM of IHI


This year’s AGM of International Hotel Investments p.l.c. (IHI) was held at the Radisson Blu, St Julian’s on 11 June. As usual, it was very well attended, with over 400 shareholders participating. 

A well attended AGM

After the Agenda was discussed and voted on, the Chairman, Mr Alfred Pisani, asked the shareholders to put forward their questions. The atmosphere was warm, and the trend of the questions was genuinely constructive and the answers informative. Insider Plus decided to publish the questions and a synopsis of the answers since the material covered would undoubtedly prove interesting to our readers. 

Chairman, Mr Alfred Pisani, making a point

After the AGM, the shareholders were treated to a delicious buffet lunch, which was well received by all and sundry.

Before the shareholders left, they were each presented with a signed copy of the memoirs recently published by Corinthia Chairman Alfred Pisani, titled The Corinthia Spirit – a gesture much appreciated by one and all.

Stock of Mr Alfred Pisani’s memoirs which were distributed amongst shareholders


Question number 1

Mr Tarcisio Barbara (Malta Association of Small Shareholders) requested:

  1. The re-introduction of annual trips for shareholders to a Corinthia property at competitive prices.    

The Chairman explained that after COVID, Corinthia had re-organised a charter flight for shareholders to Budapest and at a subsidised charge for accommodation at the Corinthia Hotel Budapest. However, since then, Air Malta ceased operations and notwithstanding we contacted alternative carriers, we are still finding it difficult to obtain a reasonable price namely because of problems of capacity / time schedules. Corinthia is still actively searching for a solution. 

  1. Improvement of the buffet offered after the AGM. 

Chairman said that following meetings with the representative of the small shareholders, Corinthia agreed to offer a much-improved buffet.

Question number 2

Mr Lino Callus endorsed the strategy to grow IHI through management agreements and the sale of assets with the purpose of realizing capital gains. Sale of owned properties seems more possible now that softer bank interests are anticipated to take place.

The Chairman offered a clear background and reasoning for this strategy direction.

In 1968, when Corinthia started its journey, the company chose not only to build and own its hotels but also took a strategic decision to manage its properties with the purpose of building a brand.  We could have decided at the time to take the easier choice to appoint established brands.  However, in order to build our own brand we had no choice but to follow the path taken.  This meant that the Corinthia brand had to develop its own professional management team over many years.  

Over the years, the Corinthia brand started to become recognized, particularly with the opening of our Corinthia London Hotel.  This had the desired effect that over recent years a number of third-party hotel owners have approached us to operate their properties.  

Corinthia has now reached the stage where it can see increased interest by third-party hotel owners to seek our management.  On reaching a certain critical mass, we will be able to gradually sell some of our own hotels.  

Corinthia will soon open new luxury hotels in New York, Bucharest, and Brussels in 2024, which will in turn further enhance the Corinthia brand internationally. We also plan to open hotels in Rome and Doha in 2025, Maldives in 2026 and Riyadh in 2027.

The prospect that many more third-party owners will ask for the Corinthia brand to operate their properties will give us the opportunity to sell some of our own hotels now that the scope of establishing a brand would have been achieved.  The sale of such properties will make it possible for the company to realise capital gains whilst concurrently reducing its debt with the banks, as also provide dividends.  It is the plan of the board to have one property sold by June of next year.  

Question number 3

Mr Adrian Said requested the re-introduction of certain shareholders’ benefits, consisting mainly of discounts. 

The Chairman explained that discounts were not discontinued but the percentage was reduced.  This was not done capriciously but as a need brought about by the severe problems caused by COVID.  Corinthia at the time had requested its employees to accept hefty salary reductions and felt that everyone, including its shareholders, should share this sacrifice. However, in the present circumstances, he agreed to review these benefits and would consider this request. 

Question number 4

Mr Andre` Bianchi requested introducing a scheme enabling shareholders to book hotel rooms at the last minute at very competitive prices. This would apply when occupancy is low and always subject to availability.

The Chairman expressed his positive interest in this suggestion. Our technical and professional personnel will work out the details.

Question number 5

Mr Mario Tabone suggested:

  1. Availability of a share buy-back option when an institutional investor joins in as a shareholder. He further recommended that the sale of such shares be made at the same price as the new entrant; and
  1. Re-introduction of certain shareholders’ benefits, consisting mainly of discounts, which had been reduced because of problems caused by COVID.  

Re (A) The Chairman explained that when the Company approaches new investors to increase the Company’s capital for its business needs, the objective is not achieved if the incoming investor buys from the market since, in that case, the sale of the shares is received by the shareholder personally and not by the company, so the Company’s capital is not increased. In any case, the possibility of the new shareholder/investor buying from the market already exists since the shares are traded continuously on the Malta Stock Exchange.

The Chairman emphasised that we need to increase the free float to 25%, which would only be possible if we do a second listing on a stock exchange with a liquid market.

However, it is essential to remember that whilst the Company’s Net Asset Value (NAV) is €1 as per the IFRS audited financial statements, which by their very nature are conservative, , IHI’s share price on the Malta Stock Exchange is below 50% of the Auditors’ conservative value.

Moreover, the Chairman added that any incoming institutional shareholder can only buy “new shares” at a minimum of €1 per share. We will, naturally, negotiate for a higher value, keeping in mind: 

  • The real market value of the hotel properties; (As an example, when we sold the Panorama in 2018, we received twice the value than that indicated in the balance sheet.)
  • The Chairman also made reference that up to last year no value was given to the two subsidiary companies namely CHL and QP, in the balance sheet, which in the opinion of the board should also be evaluated and indicated on IHI’s balance sheet.  

Re (B)The Chairman referred to his earlier answer given to Mr Adrian Said on a similar request. (See item 3 above).

Question number 6

Mr Nichol Gatt recommended floating IHI shares on an international exchange.

Chairman indicated that this was the intention of the board and will actively pursue this possibility when circumstances allow.  It is most important for IHI to be listed on an international stock exchange as for the size of IHI, the Malta Stock Exchange is too small and lacks liquidity.  Furthermore, there is no market maker who can update the value of the company.