Kition lambasts government over Larnaca marina revamp

In a letter it made public on Tuesday, Kition Ocean Holdings blamed authorities for botching the handover of operations and equipment at the Larnaca port and marina area, and said it reserves the right to sue the government for “reputational damage” caused to it by various leaks to the media that cast the consortium in a bad light.

Sent to the transport ministry a day earlier, the missive comes on the back of remarks by Transport Minister Alexis Vafeades, to the effect that Kition owes authorities a sum of money for town planning and building permits issued to it but which Kition purportedly never picked up.

In the letter, Kition gives its own version of the termination of the contract for the re-development of the marina and port, pulling no punches and using phrases like “gross mismanagement” in describing the government’s role.

Operations at the port and marina have since been taken over by the Cyprus Ports Authority (CPA), after the government moved to strip Kition of its concession.

“On May 27, 2024,” writes Kition, “the grantor [the government] sent a notice of purported termination of the concession agreement, and it ordered Kition to vacate the premises immediately so that it could take all rights over the project.

“The grantor chose not to have a handover period, that would allow for a smooth transition of the operations. Instead, it showed up with a police escort but without a real plan or direction on how to proceed…”

It went on: “The grantor’s gross mishandling of the situation has been the cause of every single problem in the transition of the operations of the port and the marina, affecting not only the transfer of employees but also the transfer of the business and assets.”

Despite offering to assist authorities with the transition, the consortium said, the government “exhibited unprecedented bad faith by attempting to shift its responsibilities to Kition after the grantor was criticised publicly for problems in the operation of the port by various groups (professional truck drivers, employees, unions).

“The grantor has repeatedly misrepresented to the media that its own delays, shortcomings and problems in the operations of the port and marina since it took over, are due to the lack of cooperation of Kition in the transfer of assets. Nothing could be further from the truth.”

The consortium next paints a picture of cluelessness on the part of the government – for example not understanding that it needed an IT specialist for the transfer of the marina master software or that it needed to have servers available.

“We eventually had to draw a step-by-step plan for you.”

Another issue, according to Kition, included the government not acting swiftly in transferring title to the machinery.

“As regards the weigh bridges, you ignored our letter to you of June 20, 2024 where we asked you if the CPA had a calibration certificate – as the current calibration certificate was in our name. Eventually on July 17, 17, 2024 you agreed to not use Kition’s calibration certificate in using the weigh bridges.”

The consortium next accused the government outright of lying: “You misrepresented to the media that Kition has locked the machinery and is not giving access to the government. As you are well aware and as was also clearly stated at our meeting on July 17, 2024, all keys are held by your employees and you have access to everything. Kition only had spare keys which shall be handed over to you as agreed, yet you continue to misrepresent the situation in the media by mouth of the minister.”

The letter concludes with an apparent warning to the government:

“Your actions are causing significant reputational damage to Kition for which we reserve all our legal rights. Furthermore, we will ensure that all the misinformation that the grantor is putting into the media is corrected so that the public fully understands the true facts in this matter, and to mitigate the significant damage that the grantor is causing to the concessionaire.”

On May 27 the government moved to terminate the port concession agreement with Kition, leaving the future of the €1.2 billion development project up in the air.

At the time the transport ministry said it was left with no other choice after Kition had repeatedly failed to pay its financial guarantee. Kition disputes the legality of the contract termination.