(Bloomberg) -- Hungary outlined plans for multi-billion dollar investments in Budapest Airport to expand passenger and cargo capacity at the recently-acquired hub.
The government, which took an 80% stake in Hungary’s main airport last month, wants to build a third terminal and also improve rail and road infrastructure, Economy Minister Marton Nagy told reporters on Tuesday. Financing to improve access to the airport will be worked out over the next two months.
Each option, whether rail or road investments, would cost about €1 billion ($1.1 billion) each, the minister said. Prime Minister Viktor Orban has championed the acquisition of the airport as part of a broader push to boost local ownership in strategic assets, at a time when the government has been struggling to plug holes in its budget with extra taxes.
“We need a bigger terminal and people have to be moved in and out of the airport,” Nagy said. He said the government may consider granting concessions for the road or rail infrastructure.
Budapest Airport Zrt. estimates it will attract close to 17 million passengers this year, up from 14.7 million last year. Hungary seeks to boost passenger numbers to 25 million by 2040, Nagy said.
Hungary and Vinci SA bought Budapest Airport for €3.1 billion and assumed a net debt of €1.2 billion, paying for the stakes proportionally with the French construction giant and hub operator, which ended up with a 20% stake. Vinci executives said the third terminal in Budapest could be completed by 2032.
The government is seeking to be a driver behind the hub’s expansion, but Vinci will be the operator, Nagy said. Hungary is still in talks with the United Arab Emirates and the Qatar Investment Authority about selling a minority stake of less than 10% in the airport, Nagy said.
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