Malev unlikely to join Russia’s AiRUnion

Despite recent headlines in Russian newspapers concerning the invitation that the AiRUnion alliance has extended to Malev Hungarian Airlines to join its ranks, Hungary’s flag carrier is prohibited from doing so, according to the terms that govern its privatization. A total of 49 percent of Malev’s shares are currently owned by Boris Abramovich, a wealthy Russian entrepreneur who also controls an airline in Russia. Earlier this week, Abramovich told journalists that he would be happy to see Malev join AiRUnion, in which both he and the Russian state have a significant stake. Yet for precisely this reason, Hungary’s laws and the privatization agreement that he signed would not allow for this to occur.

It has, however, been reported that AiRUnion is looking to expand by including in its ranks more airlines and Malev has come up as a potential future member. Were this to occur, it would be possible that the balance of power within the Russian airline alliance would shift from the state-which currently maintains a majority of shares-over to the private sphere. Yet the Hungarian national airline’s potential entry into this Russian alliance would not only likely contravene the privatization agreement, but would also raise eyebrows and concerns in Brussels. The European Union would be unlikely to appreciate Malev’s potential membership in an organization that is essentially under the direct supervision of the Russian state.

Malev Hungarian Airlines was established in 1946 and is based at Budapest’s Ferihegy Airport. The carrier operates a fleet of 27 aircraft, with an additional two planes currently on order, and flies to 50 destinations.

www.malev.hu