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GYSEV AGM decides to launch Ft 47.5 bln development project

Shareholders of jointly Hungarian and Austrian state-owned railway company GYSEV decided at the company’s Tuesday AGM to launch a Ft 47.5 billion (€194.97 million) development project to build a rail line along Hungary’s border with Austria, GYSEV CEO Csaba Székely told MTI on Tuesday.

The European Union will finance 85% of the project, while the Austrian government will contribute €14.5 million toward construction of the rail line. Technological developments on GYSEV’s new railway line between Szombathely and Szentgotthard will be completed by 2011, Székely said. Shareholders at the AGM also approved the company’s financial report for 2007.

GYSEV generated profit of €75,000 from its Austrian operations and Ft 15 million from its Hungarian operations in 2007 on revenue of Ft 30 billion from Hungary and Ft 8 billion from Austria. GYSEV transported 5 million passengers in 2007, 1 million more than a year earlier, as a result of the company’s having acquired a new rail line. The AGM agreed to reconvene in four weeks to discuss increasing the company’s capital by apportioning the assets related to the new rail line. The company’s Hungarian owners would provide Ft 900 million, while the Austrians would contribute €2 million for the capital raise.

Székely said the AGM did not discuss the issue of resources to be used toward the purchase price of Ft 102.5 billion the company agreed to pay in consortium with Railcargo Austria for 25%-plus-one-vote stake in MÁV Cargo. Székely said the company will have a half a year to make a decision regarding the financing of the purchase after the EU competition office approves the transaction. (MTI-Econews)