Economy
Hungary to pocket billions within 30 days on Budapest Airport sale
The ministry said a week earlier that the state would use its put option to sell its 25%-plus-one-vote stake to Budapest Airport's majority owner, a consortium led by Germany's Hochtief called Airport Hungary Tanácsadó, by the 18 June deadline.The ministry put the value of the state's stake at HUF 36.6 billion.
“Due to the irresponsible privatisation of the formerly profitable and fully state-owned company under the Socialist government in 2005, the minority shares presently owned by the government have lost much of their value," the ministry said.
The sale was necessitated by the fact that the government shares “could not provide the holder with any significant influence over the strategic operation of Budapest Airport," it added.
“Privatised under disputed and contradictory circumstances and then resold, Budapest Airport Zrt. - due to its unprofitable economic performance - has not been able to pay dividends in recent years to MNV Zrt, who had only received dividend compensation from the co-owner (Airport Hungary Tanácsadó Kft.), which was much smaller in value than the dividends after profit; but even this was no longer due and payable to the state holding company after 2010."
The ministry said repurchasing the majority stake in Budapest Airport was not a viable alternative as the Hochtief group wished to sell its airport assets to a financial or strategic investor.
The airport, called Ferihegy International Airport before its recent renaming, was privatized in December 2005. The UK's BAA paid HUF 465 billion in the transaction and promised to pump a further EUR 260.6 million into the airport by 2011. Of the purchase price of the 75% + one vote package was in fact only HUF 60 bn, while the remaining HUF 405 bn was the counter value of the sold assets and asset management rights for 75 years.
BAA was acquired by Spain's Ferrovial in 2006 and Budapest Airport was sold to Hochtief in May 2007 for EUR 1.9 bn without assumed debt, equivalent to HUF 469 billion at that time. In the original privatization process the consortium led by Hochtief was runner-up with a HUF 406 billion bid.
“Due to the irresponsible privatisation of the formerly profitable and fully state-owned company under the Socialist government in 2005, the minority shares presently owned by the government have lost much of their value," the ministry said.
The sale was necessitated by the fact that the government shares “could not provide the holder with any significant influence over the strategic operation of Budapest Airport," it added.
“Privatised under disputed and contradictory circumstances and then resold, Budapest Airport Zrt. - due to its unprofitable economic performance - has not been able to pay dividends in recent years to MNV Zrt, who had only received dividend compensation from the co-owner (Airport Hungary Tanácsadó Kft.), which was much smaller in value than the dividends after profit; but even this was no longer due and payable to the state holding company after 2010."
The ministry said repurchasing the majority stake in Budapest Airport was not a viable alternative as the Hochtief group wished to sell its airport assets to a financial or strategic investor.
The airport, called Ferihegy International Airport before its recent renaming, was privatized in December 2005. The UK's BAA paid HUF 465 billion in the transaction and promised to pump a further EUR 260.6 million into the airport by 2011. Of the purchase price of the 75% + one vote package was in fact only HUF 60 bn, while the remaining HUF 405 bn was the counter value of the sold assets and asset management rights for 75 years.
BAA was acquired by Spain's Ferrovial in 2006 and Budapest Airport was sold to Hochtief in May 2007 for EUR 1.9 bn without assumed debt, equivalent to HUF 469 billion at that time. In the original privatization process the consortium led by Hochtief was runner-up with a HUF 406 billion bid.
