Hungarian Government Confirms Intent to Purchase Budapest Airport

Budapest Airport

Following years of clear intentions and background speculations, recently, the Hungarian government has openly stepped up once again and made it clear that they want to purchase Budapest Airport. While the ruling parties’ intentions seem more serious than ever, recent statements from the airport’s majority owners suggest that they want to keep Hungary’s biggest airfield in their portfolio.

At the moment, besides AviAlliance (owned by a Canadian fund) which has 55.4% of the ownership, Singapore’s sovereign wealth fund’s (GIC) subsidiary company, Malton, and a pension fund in Québec, Canada, are Liszt Ferenc airport’s owners.

The Hungarian state had sold the concession’s operation (the estimated value of the concession rights is estimated at EUR 1.6-1.9 billion) for 75 years back in 2005. While it was the left liberal Gyurcsány government that sold the majority, the remaining 25% was eventually traded by Orbán and the Fidesz government in 2011.

A long-desired deal

The intentions of Fidesz circles to take over the airport have long been known in Hungary, leading to several statements made in the last years, ranging from quiet offers to straightforward criticism and threats. Conflicts began some three years ago, when government officials began to criticize the undoubtedly sub-par conditions of the airport (mainly the “basic boarding gates” serving low-budget flights that lacked seats, bathrooms, heating, and cooling). Later, the PMO Chief also threatened the company. “We made it clear to the owner that either they set out to develop, or it would be best to sell it, as what was going on there could have been banned by the authorities,” Gergely Gulyás said.

The airport, however, instead of backing off, began and has since concluded the developments. The new terminal solving the issue of the “basic boarding fates” was delivered last January, just before the pandemic reached Europe. In addition, further expansions, and the building of a third terminal have been recently announced, along with additional developments and face-lifts. The purchase intentions made it back on the agenda last October, when the government controversially blocked the airport from receiving a loan needed to manage difficulties caused by the coronavirus pandemic. The PMO chief himself commented at one of his press briefings, that “…the airport’s retrieval is a relevant goal.”

Source: Hungary Today (Ábrahám Vass 2021.06.08.)