Malév will be almost fully renationalised after the Hungarian state agreed to take over the company in lieu of debts it is owed by the airline at an EGM on Friday.
Hungary agreed to take a 95% stake valued at Ft 25.2 billion in the company in exchange for making a Ft 25.2 billion capital increase. The state will not cancel its claim on calling the €32 million bank guarantee but will use it to cover loans that it issued to Malév.
Former owner AirBridge retains a 5% stake: 2.5% for private investor Magdolna Költ and 2.5% for state-owned Russian development bank Vnesheconombank.
The announcement came after protracted talks between shareholders and Hungarian government representatives from 11 a.m. until nearly midnight on Friday.
The state intends to replace the entire board of directors as well as the supervisory board, with only CEO Martin Gauss staying at the company, according to Népszabadság.
The bank has delegated former Malév CEO Péter Leonov and its deputy chairman onto the airline’s board of directors, while the national asset management company recommended its own CEO Miklós Kamarás, Tamás Kelemen, Endre Török, Ákos Németh and the present Malév CEO Gauss.
The airline also owes Budapest Airport over €20 million and the airport operator is considering initiating liquidation proceedings against Malév if it does not pay, Népszabadság learnt.
The government has a clear goal to fundamentally reorganise the company in order to make its operations sustainable; “the hard work begins now,” Finance Minister Péter Oszkó said.
Just wonderful. Renationalize a severly loss-making
enterprise, leave the CEO in place (granted he’s
only there a year), nominate ex-CEO to chair it (the
same guy who presided over it’s sale in the first
place in 2007!!!!), and of course lots more jobs for
the boys who will presumably be well rewarded with
directors fees. Perhaps EU rules will prevent the
taxpayers money being used to pay for future
investment and existing debts but I’m not too
hopeful. Another black hole.
The Magyar government loans taxpayor monies to Malev. Malev then steals or loses the taxpayor monies. Malev declares bankruptcy. Malev then refinanced by the Government with even more taxpayor monies. Raise more taxes in Magyarorszag? To give more free monies to Malev thieves and incompetents? Isnt Socialism wonderful?