A government decree passed in December 2003 promised a HUF 3 billion capital raise for ailing state-owned airline Malév. The capital raise was later called a “support from the owner,” however the ÁPV recently decided that Malév is not entitled to government support.

In a revision of Malév’s books, the ÁPV found undervalued assets, which, if valued correctly, can be used to consolidate Malév. The airline has recently seen its equity drop to HUF 451 million, while its registered capital is set at HUF 3.5 billion.

At Malév’s recent general meeting, two members of the board were replaced. Géza Fehérváry and Bálint Csikós resigned, and József Thuma, head of the Treasury Asset Department (KVI), and Gábor Sólyom, manager and owner of Falco-Consulting Bt., were appointed in their place.

The ÁPV also said the previously set conditions for Malév to receive the HUF 3billion state bailout were only partially met, while the airline made record losses at HUF 13.5 billion in 2003. Revenues and profits in the first eight months of 2004 met the ÁPV’s expectations. However, the ÁPV added that it still can not be seen if Malév will break even in 2004 and whether the airline’s operations will turn profitable on the long term.