HUNGARY: Russia's AirBridge and Lithuania's LAL short listed for privatisation of Hungarian airline Malev

Record ID: 783858

  • Title: HUNGARY: Russia's AirBridge and Lithuania's LAL short listed for privatisation of Hungarian airline Malev
  • Date: 15th January 2007
  • Summary: (CEEF) BUDAPEST, HUNGARY (JANUARY 11, 2007) (REUTERS) MALEV PLANE ARRIVING PLANE TAXING JET ENGINE PROPELLER TURNING AND CABIN WITH CAPTAINS SERVICING GATHERING ROUND PLANE
  • Embargoed: 30th January 2007 12:00
  • Keywords:
  • Location: Hungary
  • Country: Hungary
  • Topics: Industry
  • Reuters ID: LVA9OIPNVQ5E3LE8VYJZBJNARR6J
  • Story Text: Hungary's State Privatisation Agency shortlisted Russia's AirBridge and Lithuania's LAL as the two finalists in the bid for the privatisation of the Hungarian airline, Malev, one of Central Europe's leading carriers. Hungary's State Privatisation Agency (APV) selected on Thursday (January 10) AirBridge and LAL Investiciju Valdymas for further talks on the sale of state-owned air carrier Malev, APV said in a statement.
    The agency started the talks with three investors last month, but decided against the bid of the Ofer Hava group, it said. It did not disclose further details.
    The Ofer Hava group is advised by an Irish businessman whose investment group has ambitions to expand into central and eastern Europe's aviation market.
    Airbridge is owned by Russian businessman Boris Abramovich whilst LAL Lithuania's biggest air carrier, is a company controlled by Lithuanian electronic and engineering solutions firm Fima and its partners.
    "We are considering the purchase price, the extent of capital raising and the obligations undertaken for the future, - this is the financial part of the offers. There is also a professional part of the evaluation where we examine the future of the airline and the professional background of the investor. And there is a third bigger part which looks at what steps and guarantees can the investor nominee make in order to lower the state loans," APV spokesman Peter Oravecz said.
    A Hungarian daily paper said based on undisclosed sources, that LAL offered 120 million euros (156.2 million U.S. Dollars) for Malev, while AirBridge submitted a bid of 160 million euros for a 99.95 percent stake.
    "Malev needs capital, trustworthy professional background, professional partner. In our opinion a private investor with a professional background can ensure this for the airline. With the accession to the European Union the state can no longer inject capital in state companies, only private investors can do that. And anyway, nothing really makes it necessary for the airline to remain in state ownership," Oravecz said.
    The sale of Malev has failed five times since the change of government in 1990 but observers say this time the sale has good chances to go through in the near future.
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