Hungary may relaunch airport sale tender-APV

Budapest's Labour Court ruled last week that the privatisation tender was invalid after the airport's Workers' Council complained that it had not been properly consulted on the decision to sell Hungary's main international airport.

The State Privatisation Agency, APV, announced the preparations on Monday, when airport workers also held a two-hour strike to protest against the sale and the opposition launched a fresh attack on the government demanding a halt to the sale.

That labour court decision is now subject to appeal by the State Privatisation Agency, but no date for a ruling by Budapest city's top court has been set.

"Regardless of the time frame of the court decision, in case a favourable ruling does not come in time (for the Nov. 2 closing bid date,) the APV has begun to prepare a possible new tender," APV said on Monday.

APV said it was too early to discuss the details of a possible new tender but a finance ministry spokesman said the government is determined to close the deal this year, even if a new tender has to be launched.

"If all else fails, (if the appeal is turned down or a ruling does not come in time) we have prepared this second alternative but even if a new tender is put out, the privatisation would take place before the end of the year," Ferenc Pichler told Reuters.

In the first round of bidding for a 75 percent minus one share stake, the top bidder offered 390 billion Hungarian forints, ($1.98 billion) twice as much as the government had originally expected, likely making the sale Hungary's biggest ever privatisation transaction.

The five bidders who made the second round are Germany's Hochtief AG , which made the highest bid, Frankfurt Airport operator Fraport AG , Britain's BAA Plc , Denmark's Copenhagen Airports A/S and Australia's Macquarie Airports Holdings Ltd .

But the opposition Fidesz said the transaction is illegal and does not serve the interest of the country so it should be stopped.

Fidesz also promised to use every possible legal channel to stop the deal and said if it came back to power in elections in spring 2006, it would renationalise the airport.

Meanwhile, airport workers held a two-hour strike on Monday to demand a collective agreement, wage increases and promises that ground handling and ground passenger services would not be sold off or outsourced.

The shortlisted bidders have until Nov. 2 to file binding bids in which they may raise but not lower their offers. Most bidders said last week they remain committed to the process and would continue to participate despite the court ruling.

Source: Reuters