Villa to receive USD 18 million compensation to vacate Kaadedhoo Airport

The government has agreed to compensate Villa Group with USD 18 million, or equivalent tax relief, in exchange for handing over Kaadedhoo Airport.

The airport was leased to Villa Air in 2013 for 50 years, but the agreement was cancelled in 2017 under former president Abdulla Yameen’s administration.

The Civil Court later ruled in favour of Villa, with the High Court and Supreme Court upholding the decision. The airport was returned to the company in March 2022.

Since then, the facility has faced criticism over poor services and lack of maintenance. The government has expressed interest in taking over the airport to redevelop it, and Villa chairman Qasim Ibrahim indicated he was prepared to vacate the site if compensated. Villa had initially sought USD 21 million.

On Tuesday, the Economic Council decided to offer USD 18 million, payable in instalments over 18 months, either in cash or as a set off against Villa’s tax liabilities.

Qasim shared the council’s letter on X, confirming the arrangement was based on losses and investment made by the company.

“We are leaving it [Kaadedhoo] to the government knowing the huge benefits of turning it into an international airport,” Qasim wrote.

At a rally on Thursday, former president Yameen accused the government of corruption, claiming USD 30 million in tax had been waived in the deal. Qasim dismissed the remarks, saying Yameen had exaggerated to mislead the public.