Hungary's Strategic Defense Stake Sale: A Pre-Election Move

Hungary plans to sell a significant stake in its defense industry to the 4iG Group as the government gears up for upcoming elections. The sale, valued at 82.8 billion forints, includes stakes in prominent defense companies. Opposition voices have criticized the move as detrimental to national interests.

Hungary is set to sell a major stake in its defense industry, including holdings in Rheinmetall's local factory, to the 4iG Group, according to the Economy Ministry. This strategic move comes ahead of an election where Prime Minister Viktor Orban faces a significant challenge, testing his decade-long tenure.

The state-owned N7 Holding, which possesses stakes in nine defense-related companies, will see its assets transferred to N7 Defence Zrt, a newly-formed subsidiary. Subsequently, 4iG subsidiary 4iG SDT is poised to acquire a 75% majority holding in N7 Defence Zrt, while the remaining shares will stay with the government.

The anticipated sale, worth up to 82.8 billion forints ($238.4 million), comprises stakes in Rheinmetall's Hungarian subsidiary, the Airbus Helicopters plant, and a firearms factory. Criticism from opposition leader Peter Magyar, who labeled the move as 'tantamount to treason,' spotlights rising tensions as elections approach.

(With inputs from agencies.)