Hungary National Airline Sold
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Hungary's Malev Airlines sold to Russian backed consortium
Airbridge, a Hungarian consortium backed by Russia's KrasAir, has bought the Hungarian state's 99.95-percent stake in debt ridden Malev Airlines for 200 million forint (793,650 euros, 1.04 million dollars), officials said Friday.
Airbridge also agreed to provide a 50 million-euro capital injection to the ailing airline and repay 13 billion forint of the company's debt by about year end, the state privatisation agency APV said in a statement.
APV is satisfied with the result of the privatisation and the sale will definitely have a positive effect on the airline, the statement said.
It was the government's fourth attempt in less than three years to rid itself of Malev, which closed 2005 with losses of 1.27 billion forint.
Malev's debts of 32 billion forint and the state's insistence until recently that the buyer assume all of it foiled earlier attempts to sell the airline.
KrasAir, in which the Russian state controls a 51 percent stake, also agreed to pay the interest by 2018 on another 19 billion forint of Malev's debt as well as to use one-fourth of future Malev profits to repay the principal.
KrasAir Chief Executive Boris Abramovich said he hoped to lift Malev out of the red as early as 2009.
We plan on returning to profitability within two years, he told a press conference in Budapest.
KrasAir, which carried 1.8 million passengers in 2005, is Russia's fifth largest airline and is also part of AiRUnion, an alliance of five Russian airlines, which together carried 4.8 million passengers last year.
Meanwhile Malev, which has a fleet of 29 aircrafts, of which 18 are Next Generation Boeing 737, carried three million passengers in 2005.
It will be the first central or eastern European airline to join the oneworld alliance when it assumes full membership on April 1. The alliance groups some of the world's biggest carriers, including American Airlines and British Airways.
For more information on Budapest Property, please contact WW Property Investments for the latest Budapest property developments.
Hungary's Malev Airlines sold to Russian backed consortium
Airbridge, a Hungarian consortium backed by Russia's KrasAir, has bought the Hungarian state's 99.95-percent stake in debt ridden Malev Airlines for 200 million forint (793,650 euros, 1.04 million dollars), officials said Friday.
Airbridge also agreed to provide a 50 million-euro capital injection to the ailing airline and repay 13 billion forint of the company's debt by about year end, the state privatisation agency APV said in a statement.
APV is satisfied with the result of the privatisation and the sale will definitely have a positive effect on the airline, the statement said.
It was the government's fourth attempt in less than three years to rid itself of Malev, which closed 2005 with losses of 1.27 billion forint.
Malev's debts of 32 billion forint and the state's insistence until recently that the buyer assume all of it foiled earlier attempts to sell the airline.
KrasAir, in which the Russian state controls a 51 percent stake, also agreed to pay the interest by 2018 on another 19 billion forint of Malev's debt as well as to use one-fourth of future Malev profits to repay the principal.
KrasAir Chief Executive Boris Abramovich said he hoped to lift Malev out of the red as early as 2009.
We plan on returning to profitability within two years, he told a press conference in Budapest.
KrasAir, which carried 1.8 million passengers in 2005, is Russia's fifth largest airline and is also part of AiRUnion, an alliance of five Russian airlines, which together carried 4.8 million passengers last year.
Meanwhile Malev, which has a fleet of 29 aircrafts, of which 18 are Next Generation Boeing 737, carried three million passengers in 2005.
It will be the first central or eastern European airline to join the oneworld alliance when it assumes full membership on April 1. The alliance groups some of the world's biggest carriers, including American Airlines and British Airways.
For more information on Budapest Property, please contact WW Property Investments for the latest Budapest property developments.
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