Mészáros and Tiborcz Make Major Purchases With State Funds Intended for Economic Stimulus
Lőrinc Mészáros and István Tiborcz, business interests closely associated with the government, have consolidated substantial state-provided funds earmarked for overcoming the economic crises brought on by the coronavirus pandemic and the ensuing war.
In a move reminiscent of an early Christmas present, the state-owned Hungarian Development Bank (MFB) awarded a mega-loan worth EUR 140 million (more than fifty billion forints) to Talentis International Construction Investments Ltd., a newly acquired enterprise of Lőrinc Mészáros. This was revealed in a December contract in which the bank secured a mortgage on business shares of the enterprise.
This company, which seems to enjoy an abundance of public funds, has a significant mission: to assert Mészáros's control, with an iron fist if needed, over domestic cement factories which are owned by foreign entities that the government intends to oust. The new enterprise accomplished this by acquiring the Lukavac Cement Factory in Bosnia. To ensure the success of the transaction, Talentis International was injected with EUR 60 million in fresh capital in December, of which EUR 45 million was pumped in by the MKB Private Equity Fund. This fund is one of the crisis management funds established in 2020 by MFB, with each receiving fifty billion forints and ostensibly aimed at stimulating the economy.
The MKB Private Equity Fund, part of the business empire related to the entrepreneur, is managed by the MBH banking group. The group was also responsible for providing the state-mandated 30 percent private capital. Therefore, Mészáros is financing his foray into the cement industry through an investment fund predominantly supported by state capital and managed by his own bank, along with a hefty state loan.
It is open to interpretation whether this is indeed the desirable manner for state funds aimed at boosting the economy to be utilized.