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New Euronews Owner, Alpac Capital, Linked To Hungarian PM's Adviser

New Euronews Owner, Alpac Capital, Linked To Hungarian PM's Adviser

A majority stake in the Euronews media network is being sold to a company run by the son of a key adviser to Hungarian Prime Minister Viktor Orban, who has been widely criticized as an enemy of press freedom.

Euronews announced on December 17 that Portuguese investment firm Alpac Capital, whose chief executive officer, Pedro Vargas David, is well connected in Hungary and is the son of Orban adviser Mario David, will buy an 88 percent share from Egyptian tycoon Naguib Sawiris.

In recent years, Euronews has seen falling revenues and has been subsidized by the European Commission.

The purchase price has not been disclosed, but the planned capital increase could further increase the share of Portuguese ownership in the troubled channel, which provides content in 15 languages and reaches an estimated 145 million people.

Under Orban, Hungary has been chided by rights groups for having a poor record on media freedom, while being accused of influencing media regulators, targeting media and journalists who have reported critically on his government, and providing state funds for pro-government media.

In 2010, when Orban returned to the post of prime minister for the second time, Hungary was ranked 23rd on Reporters Without Borders' press-freedom list. By 2021 it had slipped to 92nd place.

Mario David, the father of the Alpac Capital CEO, is a right-wing Portuguese politician, former member of the European Parliament, and current adviser to Orban on issues related to the European Union. He also served as the vice president of the center-right European People's Party, the largest party in the European Parliament.

According to a list on the website of the Hungarian prime minister's office, Mario David has a contract until the end of 2021 and is advising Orban for free.

RFE/RL contacted the prime minister's office about Mario David's relationship with Orban but has not yet received a reply.

Orban and Mario David have reportedly known each other since the fall of the Berlin Wall and, in April 2016, Orban called Mario David a "true friend" when he awarded him the Middle Cross of the Hungarian Order of Merit in Lisbon. The Portuguese politician received the award for "supporting Hungarian interests."

When Portuguese Prime Minister Antonio Costa visited Budapest in summer 2020, Mario David attended the meeting as part of the Hungarian delegation, Portugal's online publication Observador reported.

Pedro Vargas David, who was educated at Harvard and has worked for the McKinsey & Company management consulting firm, has many ties to Hungary, and according to a profile in the Hungarian-based Index magazine lived in Budapest in 2019.

Pedro Vargas David founded a joint investment fund in 2017 with EXIM, Hungary's official export-credit agency. He also has a 5.25 percent stake and seat on the board of directors in 4iG, a Hungarian communications giant that has won numerous state contracts in the IT sector and whose owner, Gellert Jaszai, is considered well connected to Orban.

'Europe's CNN'

Euronews was founded in 1990 with the aim of becoming the "European CNN" and was initially in the hands of a consortium of European public broadcasters.

In 2015, the Egyptian tycoon Sawiris became the main owner through the Luxembourg-based Media Globe Networks. NBC News, which is owned by U.S.-based telecommunications conglomerate Comcast, sold its 25 percent stake in Euronews to Sawiris in 2020.

After the sale to Alpac Capital, the remaining 12 percent of Euronews will remain in the hands of a consortium of public television companies and local authorities.

For years, the European Commission, the executive branch of the European Union, has subsidized Euronews with significant sums of money.

Politico reported that in 2019, the European Court of Auditors expressed concerns that between 2014 and 2018, Euronews relied on 122 million euros ($138 million) in funding from the European Commission, around one-third of the company's annual turnover.

The contract, signed in July, runs until 2023 and "does not contain direct funding obligations, but allows the commission to sign specific contracts on funding," the spokesman said.

According to the auditors in 2019, the European Commission, which has been criticized in the past for taking little action to curb attacks on press freedom, should have a mechanism in place to check that Euronews "complies with its commitments to maintain editorial impartiality."

The commission spokesman did not comment on the change in ownership, saying Euronews is a private company and that the European Commission has no stake in the channel, nor does it have any role in making financial, managerial, or personnel decisions.

"That said, we are following developments closely to make sure that any changes in the company's management or editorial workflows do not impact our contractual arrangements," the commission spokesperson said.
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