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State-owned companies to pay combined dividend of HUF 23 bln in 2011

State-owned companies are to pay HUF 22.9 billion of dividend next year, a supplement to the 2011 budget draft shows.

The Hungarian Electricity Works (MVM) is expected to pay HUF 10 billion as dividend in 2011, lottery company Szerencsejáték will pay HUF 4 billion and the State Motorway Management Company (AAK) will pay HUF 1 billion.

MVM last paid a HUF 35.1 billion dividend on 2009 profit of HUF 36.7 billion. HUF 20 billion of the dividend was paid in advance, already in 2009. Szerencsejáték paid a HUF 7 billion dividend, topping up 2009 profit of HUF 5.1 billion with HUF 1.9 billion from profit reserves.

Proposed legislation would allow the Hungarian National Asset Management Company (MNV) to spend HUF 14.4 billion on capital raises in 2011. Most of the amount – HUF 13.75 billion – would be allocated for Hungarian airline Malév.

The capital raise in the national carrier is necessary because the airline has negative net assets, MNV said when asked by MTI. The cash raise would be used to make up for a lack of working capital due to seasonal effects, support necessary steps in the airline's reorganization and reduce its debt, MNV said. MNV noted that the budget act only creates the conditions for the capital raise; in order to carry out the raise, it must be approved by the relevant bodies.

Capital raises will also go to IT company Kopint-Datorg, race track operator Hungaroring, and Gödöllői Királyi Kastély, which operates the Grassalkovich Palace near Budapest.

Kopint-Datorg will get HUF 967 million, necessary for the operation of the government's IT network, MNV said when asked by MTI.

Hungaroring's capital will be raised by HUF 500m as no support for the company was planned in 2010. A review of Hungaroring's position is underway, and the size of its losses as well as steps necessary to maintain its liquidity will only be known after the due diligence is completed.

Gödöllői Királyi Kastély will get a HUF 203 million raise to cover higher than expected renovation costs and the reconstruction of a road leading to the palace, which will host several important international events during Hungary's European Union presidency. (MTI-Econews)