MIDI has told its shareholders that the Manoel Island project is no longer viable without political backing—and that it’s better to settle than fight.

At its annual general meeting, the company confirmed it’s in formal talks with the government to return the concession for Manoel Island. MIDI chairman Mark Portelli made it clear: dragging the dispute through court won’t help the company. “It would be naïve to think otherwise,” he said.

The comments came just one day after a meeting between MIDI and Prime Minister Robert Abela, who struck an optimistic tone about reaching a deal. MIDI now appears to share that outlook, telling investors that litigation would only prolong uncertainty for a project already starved of political support.

But the company isn’t backing down entirely.

In a judicial reply filed Thursday, MIDI rejected the government’s claims that it breached the concession agreement by missing deadlines. It called the accusations “unfounded” and warned it would hold the government responsible for any damage caused by public statements on the issue.

The government had earlier demanded penalties, arguing that MIDI violated a clause in the deal that set clear timeframes for progress. MIDI disputes that reading, saying other clauses in the agreement automatically extend the deadline—by at least 10 years and counting.

“This is not news to you,” MIDI said, claiming the government had never previously challenged this interpretation.

At the AGM, MIDI laid out several reasons for delays, including drawn-out talks with the government, changes to the site’s masterplan, archaeological discoveries, and an ongoing heritage impact assessment.

The company told shareholders it valued the entire concession—covering both Tigné Point and Manoel Island—at €350 million. That includes €57.8m in upfront cash, €180.6m in ground rent over 99 years, and €112m in restoration and infrastructure costs. It’s still unclear what portion applies specifically to Manoel Island, or how much MIDI is hoping to recover through a settlement.

Meanwhile, MIDI is under pressure. The company posted a loss of €3.7 million last year, and its share price is at a five-year low.