Russian bank ponders Malev move

Moscow
Source:
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Hungarian carrier Malev may go through a change in ownership and management if its Russian financier Vnesheconombank (VEB) chooses to assume a pro-active role in its turnround.

The state-controlled bank is believed to have begun due diligence with a view to taking a lien on the airline's assets pledged by its owner AirBridge as loan collateral while Aeroflot has suggested it could become the bank's managing agent for Malev.

"Professionally, it would be an interesting but challenging task," says Aeroflot deputy director for planning and finance Mikhail Poluboyarinov, citing Malev's inadequate earnings and substantial liabilities.

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Malev's financial position will be discussed at an extraordinary shareholders meeting. "We'll discuss ways to further increase charter capital," says chief executive Peter Leonov, admitting Malev is still in the red almost two years after AirBridge acquired it under a VEB-financed privatisation deal. But he adds: "There are no [talks about] changes in the ownership."

Hungary's authorities, however, are understood to have reached an understanding with Russian officials about the need for a new strategic partner for Malev. Reports also suggest Hungary is concerned over the workability of Malev's rescue plan, following the collapse of AirUnion founded by Boris Abramovich, who owns 49% of AirBridge.

Malev shareholders have recalled Abramovich from board chairman, leaving Leonov in place to pursue the current turnaround plan. Decisions regarding the chairman's position and the company's overall financial situation will be made at the next meeting pending advice or more clarity from the financiers.

Aeroflot has suggested it could become the bank's managing agent for Malev