The investigation into the dealings of the Mauritius Investment Corporation (MIC) and Eastcoast Hotel Investment Ltd (ECHIL) is like diving into Pandora’s Box.  What started as a mere inquiry into allegations of over payment is now peeling off, uncovering malicious practices all strangely  benefiting a silent spectator basking in the SUN. 

While the investigators from the Financial Crime Commission (FCC) are currently   focussed on sorting out which of the two Minutes of Proceedings  in their possession is actually genuine, they might well face a new conundrum. A third version of the minutes of proceedings just popped up showing even further discrepancies. While the first two Minutes of Proceedings do indicate Ms D Sewraz as Acting Company Secretary, the third version mentions the name of Ms K Deepoo in attendance as Acting Company Secretary at the Board Meeting held on 5^th February 2024. The intriguing facts are i) This version was sent by mail on 21^st February  and not uploaded on the DiliTrust platform ii) Important details contained in the first draft have been omitted in the 2 other versions, iii)  Ms K Deepoo did record minutes of proceedings in couple of occasions in 2023, but she never acted as Company Secretary in 2024. 

            
Sorting out the timeline of events should enlighten the FCC. With the board meeting being held on 5th February 2024 and Mark Florman announcing his resignation early July 2024, effective as from 30 September 2024, it remains beyond understanding why the former Chairman of MIC was called upon on 18th November 2024 and given a few hours to approve various sets of documents. Investigators from FCC will benefit from retrieving all correspondences by email and WhatsApp exchanged between the management of MIC and Mark Florman.   

It is mainly paragraph 4 & 6 of the minutes of proceedings (Board Meeting 63) which would retain the attention of investigators . They seek to understand why the final minutes sent out to Mark Florman on 18^th November 2024 has been redacted as to expunge the following statement  “which would guarantee an annual inflation-indexed rental yield of at least 8.5% p.a on the imputed transaction value of the Hotel which shall be for a maximum value of MUR 3.0 billion and the settlement of the charge holders amounting to Euro 4.2 million and MUR 212.9 million be effected”. 

A  diligent analysis of all documents relating to the ECHIL, would enable investigators to observe : 

a) BOTH the  management of MIC and the board  consistently refer to acquisition of 70% of 1596 Class B shares of ECHIL based on the valuation by ELEVANTE of MUR 3.0 billion. 

b) The selling price of 48 million euros is mentioned repeatedly but no indication of the exchange rate in MUR nor the conversion in euros of 70% of the MUR 3.0 billion are provided in any of the documents. 

c) The rental yield of at least 8.5% presented by the management of MIC and approved by the board has been adjusted to 8% in the final minutes presented to Mark Florman for approval. 

The Sunny side of the story 

 The MIC portrays itself as  an active investor and owner, aiming to deliver sustainable value over the long term. Its investment in ECHIL was deemed an opportunity to generate sustainable returns. In its initial investment document pertaining to ECHIL the MIC considered 2 options namely : 

1. To acquire 70% of Eastcoast’s shares and lease the Hotel to SRL on new terms which guarantee an annual inflation-indexed rental yield of at least 8.5% on the imputed transaction value of the Hotel, with Ciel Ltd as guarantor; or

2. To acquire 100% of Eastcoast’s shares and lease the Hotel to another operator on same terms as option 1.

Which implies the Investment team of MIC was even considering an outright acquisition of ECHIL and leasing of the property to an operator other than SUN Ltd. Surprisingly  a term sheet agreed with SUN Ltd on 30^th April 2024 mentions  a call option to purchase 21% of the entire issued share capital in ECHIL . The rationale provided by management of MIC is the need  to regulate the impact of the transaction between MIC and Apavou!! Which brings us to the following  schedule of events: 

1. Board of MIC approves acquisition of 70% of ECHIL on 5^th February 2024
2. Term Sheet with SUN Ltd agreed on 30 April 2024
3. Share Sale & Purchase Agreement with Apavou concluded on 15^th May 2024
4. Sun Ltd formulated its call option to the MIC to purchase 21% share capital in ECHIL for an amount of EUR 14.4 million, on 10 July 2024
5. The Financial report ending June 2024 does mention the provision for sale of shares to SUN Ltd
6. Management of  MIC  presented Board with a document bearing header “ To consider the sale of 20% of shareholding of Eastcoast Hotel Investment Ltd to Sun Ltd “ but sought retro-approval for sale of 21%, thereby offering a controlling majority to SUN Ltd  on 12^th September 2024. 

From the embarrassment of managing a debt ridden majority partner, the threat from a state institution willing to take over 100% of the shares while even considering to oust the operator, to becoming the controlling shareholder in a simple cheap move, SUN Ltd has pulled off a shrewd deal. So discrete a move,  that although being a listed company, no communique has  been released. 

With so much involvement in this dealing, one would expect SUN Ltd to be summoned by the FCC. Expecting such bigshots to parade  on the ramp at Reduit Triangle  would be wishful thinking. Afterall the sun never sets for the happy few  on the Eastcoast.