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Let us get the numbers straight on the purchase of the airport, the Ministry for National Economy said in a statement. After more than a year of intensive negotiations, the sale and purchase agreement for Budapest Airport was signed on June 6, 2024. The Hungarian state paid EUR 2.48 billion for an 80% stake, while VINCI Airports paid EUR 620 million for a 20% stake.
The purchase price was paid on a pro rata basis. VINCI Airports will be responsible for the future operation of the airport under the strategic guidance of the Hungarian state. The buy-back of the airport is a great victory for Hungarian sovereignty. However, incoherent articles based on factual errors continue to appear about the acquisition, the ministry said.
‼️BREAKING‼️
Minister of National Economy Márton Nagy announced the historical reacquisition of the airport, stating, “We’ve reclaimed it, it’s in Hungarian hands again.” The government completed a historic transaction, marking the biggest deal since the political changes…
— Zoltan Kovacs (@zoltanspox) June 6, 2024
“The state presence in Budapest Airport has huge synergies, and the investment will help us to develop the airport. As has been explained in detail in several press articles,
the Hungarian State does not operate the airport, but is present as a financial and strategic investor, also requiring the proper development of the asset.
VINCI Airports is the operator. The previous operator had only 4-5 airports under its management, whereas VINCI Airports is a global player, managing more than 70 airports in 14 countries on a world-class level. This level of experience can take the operation of Budapest Airport to a new level,” the Ministry for National Economy stressed.
The airport is currently undergoing major developments. There are two directions for the development of an airport, one is to increase commercial revenue and the other is to implement improvements related to the core activity, i.e. to increase the number of passengers, which could boost passenger traffic to 20 million in the foreseeable future, they added.
To assess the airport’s EBITDA-focused performance, the years 2019 and 2024 should be used as a baseline, as the intermediate years show a distorted picture due to the COVID pandemic. The audited consolidated EBITDA (earnings before interest, taxes, depreciation, and amortization) for 2019 was EUR 254 million, meaning that the airport was acquired for nearly 16.5 times EBITDA. However, the market is currently seeing airports typically changing hands for 18-22 times EBITDA. The ministry’s calculations show that in recent years, unbiased by distortion, the median purchase price accepted by the parties in acquiring a majority stake in an airport has been 20.6 times EBITDA. Examples include Copenhagen Airport (19.8 times), London Gatwick Airport (19.9 times), and Leeds Bradford Airport (26.4 times), they explained.
All this indicates that Budapest Airport was bought back at market price.
This is also reflected in the fact that the purchase price paid for the shares was settled on a pro rata basis, as shown in VINCI Airports’ statement. In total, this means that the Hungarian state paid EUR 2.48 billion for an 80% stake, while VINCI paid EUR 620 million for a 20% stake.
Photo via Facebook/Budapest Airport
The nature of such a transaction required an agreement with the existing international banking and investment consortium, during which 100% of the creditors voted in favor of the simultaneous presence of VINCI Airports and the Hungarian state in the investment. This shows that the international investment community has established the right cooperation between VINCI and the Hungarian state.
In addition, the Ministry for National Economy reiterates its call to all to refrain from providing false and misleading information. At the beginning of July, an international press conference will be held together with the French partner, at which the plans for the transaction and the future of the airport will be presented in detail, the ministry concluded.
Via MTI; Featured image via Facebook/Budapest Airport