Prime Minister of Hungary, Viktor Orbán has unveiled new efforts to gain control of Budapest airport from its international investor ownership.
An initial offer presented over summer by the government to buy the airport was considered too low, according to two sources with knowledge of the matter. A second offer has now been submitted.
After full privatisation in 2011, majority ownership of the airport is held by Canada’s Public Sector Pension Investment Board, with a 55% stake via its German-based airport investor AviAlliance.
Singaporean sovereign wealth fund, GIC owns a 23% stake in the airport, whilst pension fund manager, Caisse de dépôt et placement du Québec (CDPQ), owns the remainder.
Hungary’s government first announced its intentions to buy back a majority stake in Budapest airport back in May. This is despite the foreign investor consortium continually stating they wish to keep hold of the airport, which is deemed to have massive potential for growth.
Five months ago, the owners said they were “committed to the airport in the long run”, while in July AviAlliance said it “deeply hoped to be given the opportunity to remain invested in this airport” when the initial non-binding offer from the government was confirmed.
However, the government is prioritising regaining control of key infrastructure throughout the country, and raised the equivalent of €4.4 billion in several foreign currency bond issues in September.
According to aviation consultant Martin Fossati: “It is difficult to evaluate an airport without having proper capex plans and traffic forecasts, but for an initial ballpark figure I would expect the airport to be valued somewhere between €4 billion to €5.5 billion.”
Orbán has long been a critic of the airport’s privatisation, with the government threatening to seize control from the current owners. The consortium first invested in Budapest airport back in 2007, taking an approximate 75% stake. The remaining 25% was acquired from the state in 2011.
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