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Airport privatization inquiry due to be concluded by December

City

The Government Control Office (Kehi) has said it expects to complete a review of the privatization of Budapest Airport, the operator of Liszt Ferenc International Airport, in December.

Kehi started the review in June. The review covers the entire privatization process and does not only aim to determine whether conditions in the privatization contract were met, Kehi told MTI on Tuesday.

Last June, the state called an option to sell its 25%-plus-one-vote stake in the airport operator to Budapest Airport's majority owner, a consortium led by Germany's Hochtief called Airport Hungary Tanácsadó, by the June 18 deadline.

The National Development Ministry put the value of the state's stake at HUF 36.6 billion.

"Because of the irresponsible privatization of the earlier profit-making, wholly state-owned company by its majority owner, the Socialist government, in 2005, the minority stake remaining in state hands has lost a significant part of its value," the ministry said at the time.

"Because of Budapest Airport's loss-making operation, the Hungarian Asset Management Company has not been paid a dividend by co-owner Airport Hungary Tanácsadó in years, but has only received much smaller dividend compensation," it added.

The airport, earlier named Ferihegy International Airport, was privatized in December 2005. The UK's BAA paid HUF 465 billion for a 75%-minus-one-vote stake plus some assets and promised to invest a further €260.6 million at the airport by 2011.

BAA was acquired by Spain's Ferrovial in 2006 and Budapest Airport was sold to Hochtief in May 2007 for €1.9 billion 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 an offer of HUF 406 billion.

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