Mol pays HUF 50 billion for the maintainer of the Budapest University of Technology and Economics

With HUF 50 billion (USD 140 million) investment, Mol will strengthen its R&D&I capacities and play a leading role in engineering education in Hungary,

Mol said in a statement on the website of the Budapest Stock Exchange (BSE).

Mol signed a sale and purchase agreement today with the Hungarian state to acquire 100% of the ordinary shares of BME Fenntartó Zrt. (BME Zrt.) for HUF 50 billion (USD 140 million), payable in annual instalments over the next 10 years.

"The transaction aims to provide a long-term sustainable and competitive organisational and financing structure for Hungarian engineering and IT education and research and development, and to strengthen Mol's role in the development of the Hungarian innovation ecosystem. Through the transaction, Mol will build a knowledge base that will facilitate both the expansion of its R&D and innovation activities and their direct integration into its business operation," Mol said in the statement.

The Budapest University of Technology and Economics (BME) is a regional leader in transport (mobility) and automotive research, chemical research and education, engineering and energy research such as hydrogen and nuclear energy, circular economy, recycling, digitalisation and IT research. It has more than 20,000 students in its eight faculties.

As part of the new maintenance model, the parties sought to create a predictable and sustainable financial framework,

which was established in a 25-year framework agreement and a 6-year financing agreement between BME Zrt. and the Hungarian state."

This will be further strengthened by revenues from industrial cooperation, grant funding and student tuition fees. On this basis, the free cash flow of BME Zrt. is expected to be positive in the coming years.

In addition, the Hungarian state has agreed to a repurchase commitment with regards to the shares of BME Zrt. held by Mol, which can be exercised in the event of a deterioration of the regulatory and operational environment. The Hungarian state and BME will have veto rights over certain issues, in particular the sale of shares in BME Zrt. and the autonomy of BME.

After the closing of the transaction, BME Zrt. is expected to be fully consolidated

Zsolt Hernádi, CEO of Mol Group said It is part of Mol's long-term strategy is to strengthen cooperation with higher education, especially in the field of engineering education.

"Cooperation with BME enables us to train engineers with state-of-the-art knowledge and to carry out real industrial research. This step is not only crucial for the future of Mol, but it can also open new perspectives for other industrial players," he said.

I am confident that BME and MOL have not only forged a new alliance, but also set an example of cooperation between the Hungarian industry and higher education,

said Charaf Hassan, Rector of the Budapest University of Technology and Economics.

Cover photo: MTI Photo/Péter Lakatos