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Malev on agenda of October Hungarian-Russian gov's talks

The situation of Hungarian national airline Malev could be cleared up at a meeting of officials from the governments of Hungary and Russia in early October, Minister of National Development Tamas Fellegi told MTI on Tuesday evening.

A settlement plan for the airline, prepared by specialists and being consulted will be finalised by a meeting of Hungarian and Russian government officials planned for early October, and a high-level political decision which could decide Malev's fate could be taken at the meeting, he said.

The minister of national development affirmed that the government wants Malev to remain under Hungarian ownership, and would be a national carrier with Budapest as a centre, servicing economic and touristic needs.

Malev is unsustainable, however, in its current form, and an agreement has to be reached with the Russian partners which would allow a change in its current structure, Mr Fellegi said without elaborating.

Malev has received HUF 35bn through owner loans and capital raises since Hungary's previous government renationalized the airline through a HUF 25.4bn capital raise, including cash and the conversion of debt at the end of February 2010. The State of Hungary acquired 95pc while former Malev majority owner AirBridge, connected to Russia's state-owned Vnesheconombank, retained 5pc of the shares.

Government commissioner in charge of air travel Attila Marton told MTI this summer that Malev owes EUR 102m to Russia's state-owned Vnesheconombank, which holds a 49pc stake in AirBridge. (MTI-Econews)