Hungary Trends – The previous week in business and finance

The European Commission wants to make Hungary pay a 76.6 billion forint (EUR 249m) fine for violations uncovered by the European Union’s anti-fraud office OLAF, government office chief János Lázár said. The burden of the fine must be shifted to those responsible for the violations, which include fraud, malfeasance in office and cartel activity, said Lázár.

BRUSSELS SHOULDN’T BUTT IN ON NATL ECONOMIC POLICY, SAYS ORBÁN

Prime Minister Viktor Orbán said he sees Brussels’ increasing tendency to interfere with matters of national economic policy as a potential area of conflict. “I will take the position in this debate…that Brussels shouldn’t have a say in matters of economic policy, such as taxes, prices or wages,” he said in an interview on public radio. “There are matters for which there is a common European policy, but Brussels shouldn’t have a say in everything, especially in those areas in which we see things differently than they do,” he added.

CHINA-CEE FUND TO ACQUIRE INVITEL GROUP FOR HUF 63 BN

The China-CEE Fund agreed to acquire Hungarian telco Invitel for 63 billion forints from Magyar Telecom, a unit of Mid Europa Partners, Invitel said. The transaction could be closed in Q1 2017, pending approval by the Competition Office.

HUNGERIT PLANS HUF 5.1 BN CAPACITY EXPANSION

Poultry processor Hungerit plans a 1.5 billion forint (EUR 4.9m) expansion at its base in Szentes (SE Hungary) that will boost capacity and create 120 jobs. The company was awarded a 1.8 billion forint state grant for the project.

Magyar Telekom said it signed an agreement to sell its 76.5 percent stake in Crnogorski Telekom, the company’s unit in Montenegro, to Hrvatski Telekom for 123.5 million euros. Both buyer and seller are majority owned by Deutsche Telekom. Deutsche Telekom holds 59.2 percent of MTel and 51.0 percent of Hrvatski Telekom.

PROVIDENCE EQUITY PARTNERS ACQUIRES MAJORITY STAKE IN SZIGET

US-based Providence Equity Partners has acquired a majority stake in Hungarian festival organiser Sziget. With the strategic investment, Providence Equity Partners will help develop Sziget’s festivals and support the company’s ambition to make its brand global. Sziget’s other owners will keep a “significant stake” as well as management rights in the company.

GVH FINES DUNA HOUSE, OTTHON CENTRUM FOR PRICE-FIXING

Hungary’s Competition Office (GVH) said it fined real estate brokers Duna House and Otthon Centrum and their respective franchise networks a combined 76 million forints (EUR 247,500) for setting prices, sharing confidential information and dividing up the market. GVH reduced the scale of the original fine by 30 percent after the parties acknowledged their violations, agreed to cooperate with GVH and waived their right to an appeal.

HUNGARY TO WIND UP RESIDENCY BOND SALES IN MARCH

Hungary will stop taking orders for residency bonds, securities whose buyers enjoy an accelerated procedure for permanent residency in Hungary, at the end of March, the Government Debt Management Agency (AKK) said. More than 1 billion euros of the bonds have been sold since the scheme was launched in June 2013.

HUNGARY REACHES DEALS ON THREE BIG PROJECTS WITH FOREIGN INVESTORS

Hungary recently reached agreements with foreign investors on three future projects, Péter Szijjártó, the foreign affairs and trade minister, said. Two of the three projects will each create more than 1,000 jobs and one will create about 1,000 workplaces, Szijjártó said. The projects are in the automotive, electronics and service sectors, he added, without revealing any further details.