Malev seeks partner for fleet expansion-Chairman

Malev, whose privatisation tender attracted three bids last month, hopes to join Air France-led SkyTeam alliance soon, and is seeking closer partnership with an airline to optimise size, new Chairman Peter Honig told Klub radio.

"Strategic alliances can survive serious market competition," he said.

Hungary's government last month picked Honig, who had led the successful restructuring of steel maker Dunaferr, to guide Malev through privatization after the airline's sale had failed three times.

"I would be satisfied if Malev broke even in 2005," Honig said, adding 2004 figures would show an improvement from the 13 billion forint ($72.02 million) loss in 2003.

"There is no risk to Malev's ability to operate in the long term," he added.

He said there was an overlap between Malev's passanger pool and that of budget airlines, but clarified the company was not planning to shift its focus to attracting budget travellers.

Malev might instead spin off certain branches to increase efficiency, Honig said.

"There are branches without which the civilian air transport could survive, and we could consider spining them off or selling them if required to keep the company operating," he said.

Source: Reuters