HUNGARY’S PRACTICAL BUSINESS BI-WEEKLY SINCE 1992 | WWW.BBJ.HU
HUF 1,250 | €5 | $6 | £3.5
BUSINESS JOURNAL BUDAPEST
VOL. 26. NUMBER 1
JANUARY 12 – JANUARY 25, 2018
SPECIAL REPORT
The Year Ahead SPECIAL REPORT
2018 Likely to Bring Lively M&A Market
Favorable global economic and financial circumstances can accelerate both the global and the Hungarian M&A market, however, economic nationalism, protectionism and restrictions on global trade all have the potential to negatively affect deal-making sentiment. 16
SPECIAL REPORT
Wish List 2018: Keep Calm and Find Breakfast
The BBJ has quizzed personalities from a wide variety of sectors to find out their hopes and aspirations for the Chinese Year of the Dog. 18
Ethically Speaking
SOCIALITE
Discover Budapest’s Gingerbread City David Holzer’s New Year resolutions see him cultivating an interest in that festive speciality, mézeskalács, or gingerbread. 22
NEWS
EXIM in Transition in Wake of CEO’s Death No permanent successor has been appointed since EXIM’s CEO, Zoltán Urbán died, but the parliamentary opposition is casting doubt on whether the export-import bank is needed at all. 5
BUSINESS
N ES BUSI
S
Zsófia Lakatos, president of the Hungarian Public Relations Association, says her industry must confront ethical challenges such as “influencer PR” in 2018. 18
Hungarian Winemaker: Sweet Romance and Dry Reality Hungarian winemakers’ enthusiasm is infectious, their determination legendary, but their experience is a warning. The reality is that achieving export sales is excruciatingly tough. 7
2 | 1 News THE EDITOR SAYS
EDITOR-IN-CHIEF: Robin Marshall EDITORIAL STAFF: Sonja Bencze, Zsófia Czifra,
Kester Eddy, David Holzer, Levente Hörömpöli-Tóth, Christian Keszthelyi, Gary J. Morrell, Rob Smyth, Ágnes Vinkovits. LISTS: BBJ Research (research@bbj.hu) NEWS AND PRESS RELEASES:
Should be submitted in English to news@bbj.hu LAYOUT: Zsolt Pataki PUBLISHER: Business Publishing Services Kft. CEO: Tamás Botka ADVERTISING: AMS Services Kft. CEO: Balázs Román SALES: sales@bbj.hu
CIRCULATION AND SUBSCRIPTIONS: circulation@bbj.hu
Address: Madách Trade Center 1075 Budapest, Madách Imre út 13-14., Building A, 8th floor Telephone +36 (1) 398-0344, Fax +36 (1) 398-0345, www.bbj.hu SUBSCRIPTIONS: Budapest Business Journal 1 year 6 months 3 months
HUF 27,500+VAT HUF 13,750+VAT HUF 6,875+VAT
News Services Hungary A.M., Energy Today, Regional Today 1 year, from HUF 179,000+VAT 6 months, from HUF 104,900+VAT 3 months, from HUF 58,900+VAT Book of Lists 2016-2017: HUF 19,120+VAT DigiBOL HUF 39,900+VAT Call +36 1 398-0344 or email circulation@bbj.hu
What We Stand For: The Budapest Business Journal aspires to be the most trusted newspaper in Hungary. We believe that managers should work on behalf of their shareholders. We believe that among the most important contributions a government can make to society is improving the business and investment climate so that its citizens may realize their full potential.
fortepan.hu / ATTILA JANKÓ
The Budapest Business Journal, HU ISSN 1216-7304, is published bi-weekly on Friday, registration No. 0109069462. It is distributed by HungaroPress. Reproduction or use without permission of editorial or graphic content in any manner is prohibited. ©2017 BUSINESS MEDIA SERVICES LLC with all rights reserved.
A VISIT TO THE WISHING WELL FOR 2018 So, what did you wish for in 2018? It being that time of year, when resolutions are made and almost as quickly broken, we thought we would ask a few people what their hopes were for the year ahead. You will find that story on pages 18-19, just after our round up of what some of the leading business analysts expect from the year. The results included some familiar requests, not least the need, still, for a convention center worthy of the name, and capable of holding up to 5,000 people. Those in the hospitality sector have been asking for that since I first arrived in Hungary a couple of decades ago! There were concerns expressed about finding staff, which may not have been a problem for quite as long, but has certainly been a recurring theme over the past couple of years. One possible partial solution to that is explored separately on page ten, where we look at what might happen with the ever-growing public-sector workforce, and more particularly those on public work schemes. A call for world peace wasn’t exactly articulated word-for-word, but a desire that Christians behave like Christians (and not just speak like them) did get an airing, along with a wish that everyone just relax a little. Keep calm and carry on was also the theme, if not the actual motto, of a security expert who wanted businesses to finally take cyber security seriously and plan ahead, rather than running around like headless chickens when problems do arise. For once, no one we spoke to asked the government to ease off the pace of legislative change. This may
THEN & NOW
BBJ-PARTNERS
VISIT US ONLINE: WWW.BBJ.HU
reflect the fact that, approaching the end of its second consecutive term, the ruling parties’ breakneck speed of change has abated. It might also reflect the fact that, with the general election due this spring, no one expects much to happen between now and then beyond endless politicking. Given that, it is perhaps ironic that we do carry a story elsewhere in the paper (on page 14, to be precise), where there actually is a call for more legislation. Ford has been celebrating another good year in 2017, and auto sales in general inching back toward their pre-crisis levels, if not there yet. But the company says new car sales would be even better (for all players in the market, and by extension all of us in terms of cleaner air), if Hungary actually did something about importing older used cars (150,000 were brought in to the country in 2017 alone). Hungary is one of just seven EU states that puts no tax on CO2 emissions. Incidentally, Ford says it is also worried about finding enough car mechanics, and is working with six schools to restore the good reputation of that profession, and thus make it more attractive to school leavers. Other wishes included more ethical communications (I make no comment), and education that is fit for purpose (another recurring theme). Perhaps the oddest wish was for decent breakfast venues that are open early enough to allow for a good meal at an appropriate hour. Now, there’s a wish we can all hope gets granted! Happy New Year, everyone; may it be peaceful, and prosperous.
A man in a long pink wig and oversize glasses takes a long slug of alcohol in the streets of Budapest, celebrating the new year as 2017 turns into 2018. One hundred years ago, the scenario was quite different. The black and white photo shows Hungarian soldiers celebrating the end of 1917 on the frontline in World War I.
MTI / Tamás Kovács
BBJ
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
1
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
News
///macroscope Photo: Ministry for National Economy.
Gov’t: Disciplined Fiscal Policy to Remain Despite Election
Hungary’s economy is likely to kick off the year in a better position than it did in 2017, as expansion is now based on solid ground, says the economy minister. Although 2018 is an election year, fiscal stability will not be influenced by this, the minister insists.
Mihály Varga addresses business journalists on the year ahead at a January 2 press conference. ZSÓFIA CZIFRA
The Hungarian economy now rests on stable foundations; therefore, it can start the year from a better position than it did at the beginning of 2017, and growth will again be above 4% for the full year, Minister for National Economy Mihály Varga said at a press conference at the beginning of the year. Although fourth quarter GDP data is yet to be published, industrial production, the performance of the construction industry and the development of investments suggest that a GDP growth rate of 4.1% had been achieved in 2017. This figure is well above the EU average, and that signals that Hungary’s economic convergence has continued, the minister added. He emphasized that growth has been balanced with every sector contributing to the expansion. Last year, investment was a major growth factor, with a volume increase of more than 20%, he said. Importantly, it was not only industrial production – and in particular the vehicle segment – that was the main driver of the economy; tourism, too, performed extremely well last year, and so did the construction industry, through investments and retail sales. According to Varga, the family housing benefit scheme (known by its Hungarian acronym CSOK) played a notable role in the expansion of the construction sector.
Rising Consumption
Due to rising wages, consumption is also predicted to rise, and the ministry is expecting further output growth in the construction and tourism sectors, Varga added. This year, further upgrades are seen on the horizon. Hungary’s outlook is seen as positive at two of the three major credit rating agencies, and although ratings are usually not changed before an election, during the course of the year an upgrade may still be expected, Varga told journalists. The election year will not influence fiscal stability, Varga insisted, saying that financial policy was to remain unchanged in 2018. As he put it, the government has been committed to prudent fiscal policy and stable public finance management. As for the deficit of the general government budget, it was about 2% last year, better than previous estimates. And the ministry expects a similar figure for this year as well. The government debt-to-GDP ratio is set to remain on a descending course: preliminary data indicate that, including EXIM bank outlays (as ordered by the European Commission, although the government argued to have them omitted), this indicator is to decline from 76% in 2016 to 74.5% by the end of 2017. In the meantime, the Central Statistical Office has published several sets of nearyearend data. Among these, the first estimate of November industrial output has
been released: The volume of industrial production rose by 3.4% year-on-year. The index adjusted for working days was equal to the non-adjusted one.
Industrial Slowdown
The fresh figures show a slowdown from October, when growth was 7.6% on a yearly basis. The volume of industrial production in November – according to seasonally and working day-adjusted indices – was below the level of the previous month by 2.1%. Year-on-year, unadjusted output grew by 5.2% in the first 11 months of this year, the KSH data shows. The November data was a disappointment for some, such as ING Bank chief analyst Péter Virovácz. He, however, predicted that full-year output would still be above 5%. TakarékBank analyst Gergely Suppan thinks the slowdown could be temporary, noting that gauges of confidence in the sector, both in Hungary and its European export markets, are at highs not seen in years. The second, more detailed estimate of industrial output data for November 2017 is due to be published by the KSH just one day after this issue of the paper goes to print. Further positive data to start the year with came from the November retail trade figures. The KSH’s first reading shows that the volume of sales in retail shops, according to both raw and calendaradjusted data, grew by 6.4% compared to the same period last year. The volume of
sales, adjusted for calendar effects, rose by 4% in specialized and non-specialized food shops, by 10.2% in non-food retail shops and by 3.7% in automotive fuel retailing. In January–November 2017, the volume of sales – also according to calendar adjusted data – was 4.7% higher than in the corresponding period of the previous year.
More upgrades to come? International credit ratings agencies will start reviewing Hungary’s sovereign debt in February. The three agencies will release six reviews altogether, with Standard & Poor’s being the first on February 16, and set for its second review for August 17. Fitch Ratings will also have two reviews: one on March 9, and the second at the end of August. Although the Moody’s Investors Service usually examines Hungary’s debt status three times a year, it will only issue two reviews in 2018, the first on June 1, followed by the second on November 23. Hungary is currently rated at investment category with all three agencies, and the outlook is “positive” with both Fitch and S&P.
4 | 1 News
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
News
///in brief
Decision on Home Construction VAT Urgent Home buyers using the Family Housing Allowance (CSOK) can only sign contracts for homes which will get their occupancy permit before the middle of November 2019, vg.hu reported. The reason is that the 5% VAT rate for new home
construction projects will only be valid until December 2019. The government said recently that it may consider extending the lower rate in the second half of 2018. Tibor Nagygyörgy, CEO of Biggeorge Property Zrt. said that this will be too late as investors, market actors and buyers will be insecure in terms of planning capacities. That insecurity will
be reflected in the costs of the projects which developers will not be able to handle. Such projects will be cancelled and buyers will be disappointed. CSOK buyers will also be excluded from the market. Nagygyörgy added that the real estate business expects a rush of buyers who want to buy before prices increase significantly, but increased demand is likely to push prices up anyway. Tamás Ádány, CEO of OTP Ingatlan Zrt. said that the later the decision is made regarding the VAT rate, the longer and more significant the relapse will be. OTP Ingatlan Zrt. has also postponed buying new parcels of land for construction pending the decision, he said.
Nagykanizsa to Invest HUF 15 bln in Urban Development The town of Nagykanizsa (214 km southwest of Budapest) has received HUF 15 billion to build a multifunctional sports and event hall as well as a swimming pool within the framework of the Modern Cities program, napi. hu reported. The swimming pool will cost HUF 6.2 bln and will have 50-and 25-meter pools suitable for international events. The work is scheduled to be completed by the end of 2019.
Demand for Commercial Retail Space set to Grow CEO György Palkó standing in front of the Ajka power plant on January 9, 2018. Photo: MTI/Boglárka Bodnár
Veolia to Spend HUF 800 mln on Environmental Upgrade at Ajka French-owned Veolia Magyarország Energia will spend HUF 800 million on developments at its newly acquired power plant in Ajka in order to improve efficiency and eliminate the long-standing problem of soot and so-called fling ash around the plant, CEO György Palkó said yesterday, Hungarian news agency MTI reported. Veolia acquired Bakonyi Erőmű, the operator of the Ajka power plant (149 km southwest of Budapest), in December 2017. The investment is due to start in the first quarter of this year. The plant is fueled mainly with biomass, but also burns coal. Veolia said it wants to reduce the amount of coal used at Ajka. The French company bought and upgraded Central Europe’s biggest biomass-fueled power plant, in Pécs, in 2007. It acquired another biomass-fueled plant in Szakoly in 2016. Bakonyi Erőmű generated revenue of HUF 13 billion in 2016, public records show. The plant has 285 people on payroll, making it one of the biggest employers in Ajka.
The commercial real estate market has expanded, prospective tenants are lining up for retail space in the city center and shopping malls are almost full in Budapest, portfolio.hu reported. In the city center, new restaurants, cafés, pubs, and fast-food chains are opening, mostly as a response to increased tourist numbers. Turnover in shopping malls also increased by 14% between 2013 and 2016, and in 2017 it grew by further 6%. In 2016, 11 new retail brands entered the Hungarian market, and in 2017 four more, three of which targeted the center (Palmers, Marina Rinaldi and Pinko). Hungary is fifth on the list ranking countries which are potential targets for international brands, with 19 retail chains indicating it as a target for expansion, according to a survey by CBRE, which brands itself as the global leader in real estate services. While demand is growing, no shopping centers or retail parks were built last year, only a new IKEA store
opened in 2017 in Soroksár (District XXIII in Budapest). There are four more projects, including Párisi Udvar, Etele Pláza by Futureal, a 14,000 sqm strip mall Immochan in Solymár, and the 55,000 sqm Aquincum Center by ECE in the north of Buda. Rental fees are expected to grow in the future.
NAV has 5% More Tax Revenue in 2017 The National Tax and Customs Administration (NAV) announced that tax revenues in 2017 were 5% (HUF 609 billion) more than in 2016, index.hu reported. The rate of increase is higher than the expected rate of GDP growth, the Ministry for National Economy said. The total tax revenue was HUF 13.402 trillion in 2017. The reason for the growth is that tax rates have decreased and it is no longer worth avoiding paying taxes, said András Tállai, the head of NAV. Hungary has the lowest corporate tax in the European Union and the second lowest personal income tax, he added. NAV has a new policy of cooperating with clients as opposed to imposing fines or issuing debit order collection orders, which means that after giving notice taxpayers who had failed to pay their taxes can settle them without being charged a penalty or any additional costs.
Qatar Airways to Introduce Wide-body Airbus on Budapest-Doha Route Qatar Airways is expanding its service from Budapest to Doha, welcoming a new Airbus A330 wide-body aircraft from this summer. The route is currently operated twice-daily by the narrower-bodied A320. The increase in demand for travel to and from the country and what the airline calls its “steadfast commitment to the Hungarian market” will result in the new 272 seat aircraft being used on one of the daily flights between Budapest and Doha. Qatar Airways’ seat capacity to Doha on this flight will nearly double from the 144 seats available on the A320. Qatar Airways country manager for Central and Eastern Europe, Grisha Jenkov, commented: “We are delighted to introduce Qatar Airways’ Airbus A330 to Budapest, which will not only offer an increase in capacity to the route, but will also redefine the in-flight experience of our passengers travelling to Doha and beyond.”
ADVERTISEMENT
RON HADASSI, THE MAN BEHIND THE LARGEST HOTEL TRANSACTION IN CEE IN 2017, WILL REVEAL DETAILS OF THE EUR 170 MILLION DEAL
215x260.indd 13
2018. 01. 06. 9:10
1 News | 5
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
EXIM in Transition in Wake of CEO’s Death
LEVENTE HÖRÖMPÖLI-TÓTH
According to the spokesperson of the District Attorney’s office in Salzburg, the investigation concerning Urbán’s death is still ongoing, with final findings to be released within a matter of weeks, website atlatszo.hu reports. The DA emphasized that standard procedure was being followed, which takes place in the case of every unexplained fatality. An autopsy has established that the banker died of a heart attack; he had been found on the ground by friends, and although rescue teams arrived within minutes, he could not be revived. Urbán, born in 1960, has been in charge of the government-owned Hungarian Export-import Bank
Photo: Eximbank
No permanent successor has been appointed since EXIM’s CEO, Zoltán Urbán was found dead on a ski slope in Austria on December 30, but in the meantime the parliamentary opposition is casting doubt on whether the export-import bank is needed at all.
18 months, he was apparently under a lot of stress”. One cause of that might have been the fact that Hungary lost a legal dispute against Eurostat this summer, after the European Committee on Monetary, Financial and Balance of Payments Statistics (CMFB) classified “Eximbank in the General Government Sector as a unit having the features of a captive financial institution controlled by government”. The significance of that ruling is that it would mean government debt would grow by hundreds of billions of forints, as Hungary had not been including EXIM’s figures as a government cost item. The cabinet had desperately wanted to avoid this, and atlatszo.hu alleges that Urbán might have felt he was being blamed for the unfavorable outcome, since under his leadership arguments supporting the Zoltán Urbán speaking to the government stance were prepared. BBJ in mid-December. Now the parliamentary opposition seem keen to capitalize on the turn of events. LMP politician Péter Ungár pointed out that, in accordance with characterized by dignity, professional the new calculation method (and also humility and friendly helpfulness,” the including the massive Russian loan Hungarian Banking Association said in a for the Paks Two nuclear power plant statement published after Urbán’s death. expansion), government debt now equals Meanwhile, EXIM has issued its that of 2009. Therefore, Fidesz has lost own statement about how day-to-day credibility over its much-vaunted antioperations are affected by the loss of its debt campaign. Ungár added that, in its leader. “Exercising its ownership rights, current form EXIM is no longer needed the Ministry of Foreign Affairs and Trade since it cannot point to any specific has taken the necessary steps to ensure project that has benefited the Hungarian continuous running. In the transition economy. period, CEO duties shall be performed Urbán had talked to the BBJ in midindividually by András Puskás, deputy CEO and Gergely Jákli, managing director. December (see “Half of EXIM’s Loans to go to SMEs by 2021” in the December EXIM shall continue to operate along its 15 issue) when he identified EXIM’s mid-term business strategy for 2017-2021 top priority as equipping local SMEs adopted by the founder.” It declined to with the financial means to enter global answer other questions when contacted by markets. In another recent interview, he the Budapest Business Journal. highlighted that EXIM’s focus should be Under Stress shifted to help partners active in “risky” According to atlatszo.hu, renowned markets. He also wished to see exportbanking executives, who wished to bound loans and insurance double, as well remain anonymous claimed Urbán as the number of countries affected by had “grown years older within the past export financing through EXIM.
Plc. (EXIM) since 2015. He was a respected banker who had previously held management positions at OTP Bank, Hypo Vereinsbank Hungária, the Hungarian Development Bank (MFB), Dresdener Bank Hungária and Garantiqa.
“His entire life was characterized by dignity, professional humility and friendly helpfulness.” Among others, he had been board member of the European Investment Bank for six years and he was also on the board of the Hungarian Banking Association. “He actively participated in the development of the Hungarian economy for nearly three decades by assuming top executive roles in domestic and international banking. His entire life was
ADVERTISEMENT
Your essential Guide to Investing in Hungary including articles looking at the benefits available, case studies, EU funding, and commercial property investment.
AVAILABLE TO ORDER NOW Order: Business Publishing Services Kft. +36/1 398-0344; circulation@bbj.hu
6 | 1 News
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
South Buda Boasts Lowest Office Vacancy at 3% Hungary’s GRT Group has completed the third, 18,500 sqm phase of its Office Garden office park in a rare delivery for the South Buda submarket. GARY J. MORRELL
The LEED “Gold” accredited Office Garden III is currently 95% let to such international and Hungarian tenants as Agco, SIA Pirelli, Manvit, Astra Zeneca and Pannontej. “The demand for new office areas is significant because no new office scheme has been delivered in this area since 2010; the occupancy has reached almost 100% in record time,” said Robert Tilki, managing director of Robertson Hungary, which acted for the developers. Office Garden is ultimately planned to consist of five phases that will deliver working places for around
7,000 staff
in District IX, close to the Danube. Office Garden I was completed in 2008 and Office Garden II in 2010. Also in south Buda, Wing has delivered the 24,000 sqm LEED “Gold” accredited Ericsson research and design headquarters at the Nobel Prize Winners Research & Development Park located on
Office Garden.
“The demand for new office areas is significant because no new office scheme has been delivered in this area since 2010; the occupancy has reached almost 100% in record time.” the bank of the Danube. Wing will start construction of a further 20,000 sqm phase at the site this year.
Demand for Space
The two projects in South Buda were the largest handovers in the second half of last year, one of which is fully let and
the other is a built-to-suit project. This reflects the growing demand for space in the submarket with access to the technical university and Infopark. Although the projects are sustainability accredited, one critique of South Buda is that, despite its green environment close to the Danube, the area is lacking in development sites with direct metro access, a factor that has been one of the major reasons for the success of the Váci út corridor. In another development overlooking the Danube, the MOL Campus that will
include
33,000 sqm
of office space providing work places for 2,500 staff is under construction. The LEED and BREEAM accredited complex, designed by Foster & Partners and Finta Studio, will include a landmark 120meter office tower.
OTP Bank Moves Into Váci 1 OTP Bank has established a 450 sqm research and development center at the landmark Váci 1 office and retail center in Vörösmarty tér. The OTP office will include an education center, project rooms and a lecture hall in the UNESCO World Heritage listed building, redeveloped by Horizon Development. GARY J. MORRELL
OTP Bank has established a 450 sqm research and development center at the landmark Váci 1 office and retail center in Vörösmarty tér. The OTP office will include an education center, project rooms and a lecture hall in the UNESCO World Heritage listed building, redeveloped by Horizon Development. “We are delighted to welcome OTP in our historic building, where we managed to flexibly and elegantly accommodate
the Research & Development function of OTP Lab into the historic setting of this 1915 building,” commented Attila Kovács, managing partner of Horizon Development, on the deal. “The office solutions we provide to OTP Lab are all in line with 21st century sustainability and technical criteria, and the environment we offer is that of an authentically renovated Neoclassicist palace.” The property, designed by DVM group, has been purchased by the Munichbased GLL Real Estate Partners. The latest tenant will move into the building in April, bringing the occupancy rate to 100%.
Demand for office space is continuing to rise and South Buda suffers from a lack of vacant space; the submarket has the lowest Budapest office vacancy rate. “The dominance of Váci út is expected to continue to grow in the near future, the size of modern office stock handed over in the area is going to surpass one million sqm by the end of the year,” said Eston International. “In the South Buda submarket, which with 3% has the lowest vacancy rate, completion of new offices of over 110,000 sqm of space is expected to be completed a year later in 2019.” In the latest South Buda office complex, Bischoff & Compagnons is set to undertake development of the LEED certified Alphagon office building center. “Bischoff & Compagnons’ Alphagon office building, to be completed by mid-2019, is designed to provide an ideal environment for small- and medium-sized business, as well as large corporate tenants,” commented Mátyás Zórándy, regional investment manager of Bischoff & Compagnons. The company has been active as developers in the office and hotel sectors in Germany, Austria and CEE. The Budapest office was founded in 1999. With regard to overall office supply, around 13 Budapest developments are planned for delivery this year. New supply is estimated at 700,000 sqm for 20172019 according to Cushman & Wakefield, with 390,000 sqm of space currently under construction. Vacancy stands at a record low 8.6% in a city with a total quality office stock of around 3.4 million sqm.
Rare Development
Váci 1, with 5,700 sqm of office space, is a rare office development in District V. The project reflects Horizon’s strategy of developing high-end office space in historic buildings in central Budapest. District V currently has the highest rents in Budapest, however there is a very limited supply of suitable development sites. Elsewhere in the district, Horizon Development is working on
Váci 1 Attrium.
Alphagon office building.
the LEED “Platinum” accredited mixed-use Szervita Square project, consisting of 15,000 sqm of office, residential and retail space, but that is not due to be completed until 2019. The Hungarian developer is also constructing the speculative 25,000 sqm Promenade Gardens on Váci út (District XIII) in partnership with the Hungarian Erste Open-ended Real Estate Fund. The project has been awarded both LEED “Gold” and BREEAM “Very Good” accreditation, and is due to be delivered in the second quarter of this year.
2
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
Business
The Entrepreneurial Hungarian Winemaker: Sweet Romance and Dry Reality For many Magyars, city and country dwellers alike, the lure of the vineyard – making and selling Hungarian wines – is strong: for a number, it has proved irresistible. Their enthusiasm is infectious, their determination legendary, but their experience is a warning. The reality is that the business of winemaking, most particularly achieving export sales, is excruciatingly tough. KESTER EDDY
Like many Hungarians, Laura Rabcsánszki grew up with wine in the family, later studying oenology. So, in 2010, when she went to live with her husband in his home town of Mezőkövesd in central Hungary, it was natural to begin her own wine business. With capital limited, Rabcsánszki started small, but with high hopes. Naming her operation Revolution WineZ (RWZ), from the outset she determined to produce good quality wine; anything less from a small operation would be commercial suicide. And with the domestic market over-supplied with everything from the plonkiest plonk to the sweetest Tokaji Aszú, her plan was always to export – most especially to the United Kingdom. “Early in 2016, we approached an agent who promoted Hungarian wines in London and we agreed to take part in a campaign, including a tasting and an article in a trade magazine, all in association with other Hungarian, mostly larger winemakers,” she says.
Laura Rabcsánszki, who set up Revolution WineZ in 2010 in Mezőkövesd, central Hungary. Hosted by two wine experts with experience of Central Europe, the tasting attracted a number of journalists and wine retailers. “Our wines were praised,” Rabcsánszki says. But the good news ended there. With almost no resulting sales, she dropped any further action. “It was getting enormously expensive,” she says.
Brutal Reality
Despite much mutual bonhomie about the prowess of Hungarian wines at home, Rabcsánszki was learning about the brutal reality of the global wine market first hand. As she puts it: “Hungarian wines are only world-famous in Hungary. They are not known, and not considered at all, abroad. The retailers I had contact with were also only just beginning… to commercialize Hungarian wines in the premium segment of the English wine market.” Rabcsánszki’s experience is far from unique. Marta Wille-Baumkauff took up her life-long dream to open a winery in 1991, originally buying a carefully selected single hectare in Tokaj and picking her first vintage in 1993. Budapest-born, and with no practical experience in winemaking, WilleBaumkauff opted for a strictly biodynamic vineyard operation at a time when such thinking was decidedly “offthe-wall”. Despite, or perhaps because of, such eccentric (and expensive, and timeconsuming) principles, she received much collegial support from the viticulture community in Tokaj and from her many contacts in Germany (where she had lived for some years). Her dedication has resulted in “partners in Spain, Switzerland and Poland who
are quite reliable and regularly order our wines”, but, she laments, “you can never be sure if it will be the same next year”. And the United Kingdom? “I have been a couple of times to the UK hoping to find a distributor, but I have never succeeded – even being certified organic”.
Find Your USP
Máté Csanaky, head of sales at the Zsirai Winery, says that despite nearly three decades economic liberalization, most Hungarian producers “don’t know much about the international wine market” and “don’t taste many foreign wines”. His experience at Zsirai, which has 18.5 hectares under vine across three different regions of Hungary and exports to the European Union, as well as China, means “every country is different. You’ve got to get a USP [Unique Selling Point]. Hungarian grape names, like Hárslevelű, are difficult for foreigners, so give your wine a ‘fantasy’ name,” he says. Both Csanaky and Wille-Baumkauff advocate a “well-planned, quality marketing campaign”, and several winemakers quizzed for this story advised “Look at how the Austrians have done it”. Says Csanaky: “Many Hungarian wines are good quality compared to the rest of the world, but without a concept, quality and quantity marketing, we are at a disadvantage.” That leaves cash-strapped, entrepreneurial winemakers like Rabcsánszki having to make do. “I don’t regret establishing RWZ,” she says. “Wine production is a joyful, albeit cumbersome, process every year, which I enjoy a lot.” See also A Very Pannon Party Puts Local Grapes in Focus (including a wine business for sale) on page 23.
“The World was Running Without Tokaj, Without any Problem.” It is not only native Magyars that sometimes suffer from unrealistic hopes about demand for their wines. Samuel Tinon (pictured, below) first took his golden Tokaj juices to VinExpo in Bordeaux in 2003 brimming with confidence. Tinon, a native of the Bordeaux region, was no novice. He had been working Hungary’s flagship wine region since the early 1990s, and had advised and made wine around the world meanwhile. “You know at VinExpo, the 10,000 people that are [anybody] in the wine industry from the world are there. I would come with my Tokaj, my 2000 szamorodni, first bottling, and sell everything,” he told the Budapest Business Journal. “It was a good success – everybody said ‘It’s a wonderful wine’ – but then it was just ‘Thank you very much, and that was all.” There were “almost no sales”, he recalls, concluding “The world was running without Tokaj, without any problem.” Since then, while foot-slogging around Europe hand selling his wines to Michelin-starred restaurateurs, Tinon has learned it typically takes at least two years to build a relationship of trust with importers; passion and good wine alone are just not enough. Today, he tends five hectares of his own vines and produces up to 15,000 bottles annually – 90% for export to Western Europe, North America, Poland and Taiwan. As a small winemaker, he says, “You have to identify and make your style, then persuade people to follow you and drink your wine, while paying a fair amount of money that allows you to build distribution. [...] If they want a EUR 0.50 discount [per bottle], I tell them they don’t understand.”
8| 2
Business
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
INSIDE VIEW
INNOVATION
sponsored by
Insight
Telenor Accelerate to Capture the Moment Photon Makes it Big
NOTE: ALL ARTICLES MARKED INSIDE VIEW ARE PAID PROMOTIONAL CONTENT FOR WHICH THE BUDAPEST BUSINESS JOURNAL DOES NOT TAKE RESPONSIBILITY
While there are many meaningful ways to spend a gap year, scaling-up your own startup is anything but a conventional one. Yet this is what Photon’s founder decided to do in benefiting from the Telenor Accelerate corporate startup program, which is now entering its final phase. Photon’s recipe itself is nothing new: link For a 10% commission (applicable as of service providers with customers on a February), a seamless business transaction digital platform and charge a commission follows that saves time for those looking for completed transactions. The concept for a photographer and also allows is widely used in a number of industries; them to compare prices and services in a the trick is in finding one where it hasn’t transparent fashion. It also makes it easier been applied yet. Photon, founded by for professionals to be found. 18-year-old Sári Volom, spotted untapped Proof in Profits opportunities in the photography “The beta version is up and running, and field, and now has the chance to build a now is the time to prove that we are business around the idea. capable of generating profits,” Volom “The inspiration came during my says. Since the project is in an initial phase, secondary school years, which is when gaining traction is key. Therefore, B2B I started to make money by taking communication, sales, marketing and professional photos,” Volom tells the Budapest Business Journal. network building are all crucial to make it “Market-related issues became apparent big. The ideal is secure partners that would quite fast, since it was obvious from the bring in the critical mass. very start that, from the photographer “We are reaching out to photo studios, point of view, networking skills matter far schools and photo equipment stores, while, more than talent when it comes to success.” at the customer end, marketing and real The customer side, on the other hand, estate agencies or event organizers carry seems ruled by somewhat more random nice potential,” the Photon CEO adds. behavior. SMEs in need of a pro tend to Building that network from the ground up find somebody on an ad-hoc basis, where is no easy task, and this is where Telenor’s value for money is of rather secondary expertise becomes indispensable. Thematic importance precisely because of the workshops held under the Accelerate randomness of their search. program speed up business development, Photon, therefore, provides a platform but the one-on-one mentoring from on which customers can post jobs, and György Simó (Day One Capital) and Zoltán through which they will get quotes from Varga (Central Invest) is the real spring photographers registered on the website. board in the story. “All of our mentors have been very active, they clearly want to cover every key area needed for our breakthrough,” says Volom who admits she had expected a lot more reserved involvement on the part of these independent experts. Instead, the whole team received a very warm welcome, and ever since they have been treated with care and attention. “The engagement of the Telenor experts is also exemplary; they strive to assist us in every possible way. The level of their commitment has surpassed our wildest expectations,” Volom concludes. Telenor Accelerate will end with a Demo Day in March where the three participating startups (Photon, Family Finances, Vimage) will have the chance to impress investors with what they will have learnt during their intensive fiveSári Volom, Photon. month training.
Biotech Startup Aims to Redefine Cancer Drug Scene Fighting cancer might be about to enter a new era thanks to Turbine, a Hungarian startup whose AI-guided solution could radically cut experimenting time for drugs and help design effective combination therapies. LEVENTE HÖRÖMPÖLI-TÓTH
There is probably just one thing harder than treating cancer; namely, getting to the point where the fight can start in the first place with the help of accredited drugs. Hungarian startup Turbine aims to shake things up on the experimental scene; if it succeeds, the cancer drug industry is up for a major breakthrough.
Szabolcs Nagy, CEO of Turbine. The fact that Turbine pocketed three awards at the 2017 Central European Startup Awards’ (CESA) regional final (Startup of the Year, Best Biotech Startup and Best AI Startup), and was also Health Startup of the Year at Pioneers, should be a more than promising sign. As CEO Szabolcs Nagy explains to the Budapest Business Journal, it
takes
USD 2.7 billion
and one decade for any cancer drug to be marketed. The reason for such astronomic costs and lengthy authorization procedure is the nearly 99% failure rate of research. The biggest problem is that the disease can assume thousands of different forms at any time, so molecularly diverse tumors require different treatments. The Turbine team started to model how cells work in 2010 and have now built the largest known model of simulated cancer cells. “Last year, we got the chance to test this sci-fi tech in action at Bayer, one of the largest pharma companies researching cancer drugs. This year, they asked us to help increase the effectiveness of several drugs,” says the CEO.
Turbine’s innovation is rooted in the fact that it replaces laboratory experiments with AI-based simulation. This way, millions of trials can be run on servers in the time it would take to run just one biological experiment in the real world. The results show the most promising ways to use a drug, which dramatically speeds things up.
Complex and Constantly Changing “In the case of cancer drug research, you can’t just grab a bunch of data, crunch it with an algorithm and predict what will happen accurately,” Nagy says, referencing to the practice commonly applied by developers working on autonomous driving systems, for example. “We are talking about a complex and constantly changing biological system. Standard artificial intelligence techniques barely produce better predictions than random guessing.” Turbine’s cell model has been set up by relying on thousands of publications, and its AI tool predicts how drugs impact cancer by running millions of simulations based on that. “You need to play around with the molecular setup of cells and what drug you administer in what dose to figure out the best way to tackle cancer,” says Nagy, who is anything but a business rookie. Prior to joining Turbine, he was one of the first people in the team that launched Tresorit, the world’s leading cloud security startup, and helped develop Webicina, a platform that helps patients and physicians find reliable and correct advice on medical conditions and therapeutic opportunities. The Tresorit experience taught him how to put together a great team and make it function, a skill he says he can surely make use of at Turbine, since the staff is a diverse crew of machine learning experts, biologists, bio-informaticians, medical doctors and programmers. “Over the past few years of building Turbine, and by talking with many people in the pharma industry we have gained insight into what there is demand for, and have aimed to develop our solution towards responding to real needs in research,” concludes Nagy.
S TA R T U P S P O T L I G H T
2
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
Business | 9
MNCs Looking to Help Startups Scale-up Budding Hungarian enterprises with innovative technological solutions may reach their potential markets with the help of large corporations, a new initiative promises. SONJA BENCZE
There is a swarm of innovative solutions on the Hungarian market from wearable ECG monitors to customer behavior analysis tools to intelligent indoor heaters – all looking for new markets. That only a fraction of them reaches this goal is not a question of finances, experts say. With ever more resources (from the European Union and the state, not to mention private equity and venture capital funds) available, the number of programs to mentor startups and early-stage enterprises abound. Firms that have been operating for a while, have various other options – they are more likely to enter tenders if they want to expand. Yet despite the funds and programs, most don’t get to grow at the desired pace, let alone enter foreign markets. This happens because most lack a proper business model, are not aware of the intricacies of the chosen foreign market or simply haven’t been able to find potential clients, many experts hold. To help them (and themselves) several large international firms, headed by IBM, offer a program that aims to fill precisely those gaps. A new initiative by Technopolis Innovation Center, a Budapest-based business accelerator and IBM, along with partners such as T-Systems, KPMG, and K&H Bank invite Hungarian companies with a technological solution to join their program.
Health and Tourism
The target group are scale-ups – firms that already have a ready product, but have not really been able to scale it, commercialize it or cross borders with it. In the first round of the program, companies with innovative solutions for the health and tourism industry using artificial intelligence, cloud, IoT, etc. have until
January
19
to enter. The subcategories for health industry are wearable health devices, solutions that use big data smartly, and are able to automatize imaging diagnosis
Startups looking to move on can get an inside track at Technopolis Innovation Center. assessment. As for tourism, applicants do not necessarily need to come up with something new; they can enter a solution used in another sector that could be repurposed.
“They [foreign investors] are interested in how you will achieve half or one billion dollars of sales – and such things are not taught anywhere in Hungary.” Entries are welcomed from across Central and Eastern Europe, not just Hungary. “We are looking for already operational startups aiming to enter foreign markets which we can provide with technology and clients,” explains Gábor Varga, CEO of Technopolis Innovation Center. That is the main idea behind the initiative: all the multinationals lined up behind the program offer market information, product testing and, potentially, their clients. They would act like match-makers: they monitor what their clients need, and pick from among the applicants accordingly. Then they help tailor the product to be in line with their clients’ needs, test and validate it, thus upping the startups’ chances of finding their way to customers. “Our corporate partners are the guarantee that the products get tested in real life and among potential clients,”
Varga adds. The participants will become part of the IBM Global Entrepreneur Program, gain access to IBM Cloud, and can even incorporate these technologies into their products. The use of IBM’s cloud and AI solutions, through which some products may receive IBM’s technological validation, will ensure that quality products will end up at clients, he added.
Building on Networks
According to the founders of the program, one major impediment in the way of scaling up is the inability to identify potential clients and markets. Yet, despite the financial resources available, finding investment still has its challenges. “Securing HUF 1-3 million is fairly easy. But building a functional prototype that resembles the future product, which investors actually expect, can cost hundreds of millions, which is difficult get in Hungary,” György Kozmann, CEO of wearable ECG device, HeartBit told the BBJ.
Once admitted, the roughly 16 companies the organizers are expecting to work with will go through a six-month program. In the first eight weeks, they become familiar with the markets; in the second phase, their solutions are tested in the market. In the third stage, they are “Our corporate partners supposed to enter foreign markets. are the guarantee Most of the firms in the cooperation, such as KBC Equitas, offer their worldwide that the products get clientele and network. Should some, say, tested in real life and wish to go to the United States, the bank’s local office would advise them on how among potential clients.” to open an account, etc. in any of the states, Viktor Kovács, head of K&H’s SME marketing division says. “At this point, it is hard to say whether The cost of the investment also T-Systems will invest in any of these firms,” matters: Hungarian investors usually Klementina Krégl, head of Innovation require a majority share in the company Competence Center at T-systems tells the in return, he said. The CEO has just Budapest Business Journal. “If we can returned from Australia, where he find a solution that is really relevant for us, met with local investors. For foreign T-Systems may include it in its portfolio: it investors, such an amount – HUF is possible scenario.” However, it is not the lack of investment or securing it that causes a problem, rather – is so marginal, they are unlikely to that companies are unable to create real want to get involved, Kozmann says. market value and enter into markets, she “Rather, they are interested in how you said. T-Systems’ added value in this will achieve half or one billion dollars program is its ability to find what clients a of sales – and such things are not taught product can be aimed at and how to reach anywhere in Hungary.” them, Krégl adds.
100-200 million
Business
10 | 2
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
A Public Work Solution to Hungary’s Labor Problems With Hungary’s economy facing the challenges of a deepening labor shortage, the government is exploring a number of solutions to alleviate the crisis. Restructured employment and the reintegration of public workers might be among the tools.
Number of Public Workers in Hungary in October 2017
30,694
Nógrád county
5,812
Győr-MosonSopron county
1,576
Vas county
2,118
12% pay
rise, it still cannot compete with the wages available in the corporate sector or abroad. However, there might still be some untapped reserves in the system.
Downsizing?
When daily newspaper Magyar Nemzet reported in the first week of January that the Ministry for National Economy (NGM) had recently won HUF 5 billion in EU funding for the prevention and management of downsizing, rumors spread about a significant layoff in the public administration sector, to be conducted after the parliamentary elections in the spring. NGM was quick to announce that no mass public sector layoff is planned and that the money is only to prevent and, if it happens, soften the effects of layoffs in the corporate sector. Nonetheless, given the current workforce market conditions, companies are seeking more staff than they are dismissing, and it is notable that analysts and corporate leaders have from time
KomáromEsztergom county
1,928
Fejér county
Veszprém county
3,141
Tolna county
Somogy county
3,072
7,155
Heves county
29,285
Budapest
Hajdú-Bihar county
15,073
3,711
Jász-NagykunSzolnok county
15,571
9 504
3,720
Zala county
SzabolcsSzatmár-Bereg county
5,208
Pest county
2,746
ÁGNES VINKOVITS
With the unemployment rate reaching 40-year record lows in most of the developed countries, it is also expected to stay below 5% in Hungary in 2018. But while the figures might please voters at first sight, they indicate a challenge that is looming around the corner and needs to be taken seriously. The lack of manpower is already said to be holding back growth in most fields of economy, especially in the IT, automotive and construction sectors, while it also affects state-owned companies. Provincial public transport company Volánbusz, for example, is facing serious difficulties in finding drivers, and even with a
Borsod-AbaújZemplén county
Békés county
Bács-Kiskun county
7,382
10,797
Csongrád county
5,866
Baranya county
11,749
Total:
176,036
BBJ infographic. Source: Ministry of Interior
to time come up with the suggestion that a big proportion of the
472,000 workers
in the public administration – a number that has swelled from 319,000 since 2010, when Fidesz was first returned to power – is far above what is necessary and could ease labor shortages elsewhere. Another pool of available people could be found in the public work scheme, known as fostered workers locally. The number of public workers had been permanently growing since the program kicked off in 2011 as a centerpiece of the government’s so-called workfare approach to the economy. According to the Ministry of Interior (BM), 2017 was the first year when their number dropped, by a not insubstantial 50,000, to reach a total of 176,000 by October, the latest available data at the time of writing.
Public Worker Cap
Meanwhile, a government decree in March 2017 ruled that the number of public workers should be beneath 150,000 by 2020. Accordingly, the budget of the program has been reduced by HUF 100 billion. The HUF 225 bln budget in 2018 is estimated to cover the employment of about 180,000 people. (It is worth noting that the annual program budgets have not been fully spent since 2015.)
“While about 10,000 public workers have a higher education degree, suggesting that they could be directed to the primary labor market relatively easily, a much larger proportion of people in the scheme are severely undereducated and are drawn from the periphery of society, frequently from the most underdeveloped rural areas, making their reintegration a long-term challenge.” In addition to cutting figures, decisions about structural changes have been made, too. From mid-2018, the length of time one can spend in the public work scheme will be maximized at 12 months in every three-year period, which limit can be exceeded only if it is officially deemed
hopeless to place someone in the primary labor market. Also, people under 25 can be involved in the public work scheme only if the so-called youth guarantee scheme, an EU-funded program offering special courses to quickly connect young people with labor opportunities, has failed to help. The latter amendment seems to resolve the opposition parties’ most frequent criticism over the public work scheme, namely that young people might get stuck in the program, as the approximately HUF 50,000 salary the scheme offers is clearly not enough to make a step forward, while the work itself leaves no time for people to enroll in training that could help them to find proper workplaces in the future. The approximately
30,000 public workers
coming out of the scheme in the upcoming two years could, indeed, make a difference to the workforce market, but as HR analysts warn, only with the support of a good training system. While about 10,000 public workers have a higher education degree, suggesting that they could be directed to the primary labor market relatively easily, a much larger proportion of people in the scheme are severely undereducated and are drawn from the periphery of society, frequently from the most underdeveloped rural areas, making their reintegration a long-term challenge.
YOU COULD BE HERE
Immerse yourself in Canberra Unspoiled nature and cultural attractions abound in Australia’s vibrant capital. Start your day with an epic hot air balloon ride before visiting the city’s diverse selection of museums and galleries, restaurants and public gardens. Whether you are on the ground or in the skies, Canberra has an abundance of spectacular sights to discover. Visit qatarairways.com
12 | 2
Business
WHO’S NEWS
CTP Appoints Country Manager, Senior Business Developer
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
///
Real estate developer and manager CTP has significantly strengthened its team on the Hungarian market. Rudolf Nemes (pictured) will become country manager in Hungary, effective from January 8, 2018. He joins new senior business developer István Pozderka, who took up his post on January 1. The primary task of new team will be to accelerate business growth and
Do you know someone on the move? Send information to news@bbj.hu
to strengthen the Hungarian platform in order to create the foundation for a sustainable future expansion, CTP said. As country manager, Nemes’ main focus will be on setting up the Hungarian team and improving the current structure and communication with various departments outside of Hungary. He will also be involved in HR and the business development activities of the company. Nemes, 37, is based in Budapest, where he studied economics and has had a successful career as the head of numerous departments at financial institutions and real estate development companies. “I am pleased to join CTP. My main task will be to significantly expand the Hungarian platform. I expect that further hiring’s will follow in 2018 with the effect that the local portfolio will grow by more than 25% and the profitability/efficiency of the operation will improve as well. Currently the team will be focusing on leasing CTPark Komárom with 50,000 sqm of lettable space and CTPark Székesfehérvár, where 20,000 sqm are still available for lease,” says Nemes. Pozderka, 30, and the Hungarian business team will be working on securing tenants for CTP properties, as well as initiating new developments. He studied economy and business at Corvinus University in Budapest and comes to CTP from CBRE, where he had been working since 2013 as an industrial property adviser.
CTP is a full-service firm, specializing in the delivery and management of custombuilt, high-tech business parks for leading international and domestic companies. It is the owner of the CTPark Network, which it says is the largest integrated system of premium business parks in Central and Eastern Europe, with more than 4.5 million sqm of class “A” properties in more than 80 strategic locations.
Patrik Molontay now Owner-MD of HumanField
Following a management buyout at executive search company HumanField, Patrik Molontay, who formerly led the company as
deputy managing director, has become the new managing director and owner. Molontay, who holds a degree in economics and law, joined HumanField at the beginning of 2013 as director of executive search. Previously, he worked at KPMG. His most important role besides leading HumanField is to coordinate executive search projects for top management positions at multinational and Hungarian companies. HumanField has been actively engaged in recruiting activities since 2006, with an office in downtown Budapest and principals at several locations nationwide in automotive and other production, IT, sales, pharmaceuticals, finance and the SSC industry. The company regularly participates in international projects as well.
Ritz-Carlton Budapest Welcomes GM The Ritz-Carlton Budapest hotel has welcomed Rahim Abu Omar as its new general manager, responsible for overall hotel performance and operations. Omar is a Jordanian professional who has worked in several locations, including the United Arab Emirates, the United Kingdom and Lebanon. Before joining the Ritz-Carlton Budapest, he worked for market-leading names such as Metropolitan Hotel Dubai and Metropolitan Resort & Beach Club as general manager, and at Habtoor Hotels as CEO. Most recently, he was GM of the Gulf Hotel Bahrain, where he successfully turned the property into one of the leading hotels in the region.
ADVERTISEMENT
BOOK OF
LISTS 2017 / 2018
Guide to Hungarian Business
is available.
«««
The Book of Lists c ontains all the i nformation that you might n eed in business.
Order: Business Publishing Services Kft. +36/1 398-0344; circulation@bbj.hu
2
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
Zsófia Bécsi Joins SEED as Academic Director
Hungarian Manager Appointed to Regional Position at Bayer AH
Zsófia Bécsi, a specialist with long experience in HR, has joined the Budapest-based School for Executive Education and Development (SEED) as academic director. She takes over in the position from Orsolya Gazdag, now on maternity leave. Bécsi is responsible for the organization and establishment of the entire academic program portfolio of SEED, and is also charged with maintaining liaisons with academic and corporate partners. Prior to SEED, Bécsi worked as HR manager at Wizz Air, and she has almost 20 years of experience in human resources field.
Omar played an instrumental role in the opening of five hotels, including the Metropolitan Resort & Beach Club, Metropolitan Palace Hotel Dubai, Metropolitan Palace Hotel Beirut, Habtoor Grand Beirut and Habtoor Grand Dubai. He has also participated in the comprehensive rebranding of four and five-star properties. The GM is a member of the first Hotel Committee of Dubai Department of Tourism and Commerce Marketing. He was named Hotelier of the Year in Jordan in 2009, and was also recognized as one of the top 50 influential hoteliers in the Middle East that year, as selected by Hotelier ME magazine. ADVERTISEMENT
Business | 13
Balázs Aladics has been appointed country commercial lead for South East Europe at Bayer Animal Health. He has worked for ten years in various positions at the company, according to a press release received by the Budapest Business Journal. Aladics has gained experience in veterinary practice and managementlevel work in a multinational environment. Prior to his current regional position, he was head of marketing and sales at Bayer Hungária, and business development manager at Bayer HealthCare.
SEED appoints Business Development Director The School for Executive Education and Development (SEED), based in Budapest, has appointed András Kárpáty as business development director. Kárpáty previously worked for CEU Business School, where he was in charge of tailored company and international MBA programs. He also supervised all outreach activities, including recruitment, marketing, career and alumni services. In his new position, he coordinates the recruitment/sales, marketing and PR activities of SEED.
14 | 2
Business
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
Ford Calls for Stricter Regulation of Used Car Sales
LEVENTE HÖRÖMPÖLI-TÓTH
2017 marked the first year since the recession where new motor vehicle sales figures in Hungary surpassed the average of the past decade. The total number of 142,000 units sold indicates a growth rate of some 15% compared to 2016, and even though pre-recession highs of 195,000 are still some way off, the sector seems to be back on the road to its former glory. More importantly, private buyers, who have been shying away from opening up their wallets, seem to have regained their courage. Last year they accounted for 40% of new motor vehicles sold. If you add in sales generated by micro-enterprises, which typically buy just one unit at a time for the owners themselves, quasi retail carved out some 70% of the pie. Ford has a lot to be cheerful about. For the eighth time in a row, the brand ranks number one on the list of total new motor vehicle sales (the combined sales of passenger autos and small commercial vehicles), with a current
market share of
11.8%
and 16,033 units sold. When you look at passenger cars alone, Ford was in second place with a 9.8% share, behind Suzuki on 13%.
Wide Spectrum
“Our success is primarily due to the fact that we perform well not just in one single segment,” Viktor Szamosi, managing director of Ford Magyarország at a press conference called to look at the success of 2017 and the plans for 2018. “We probably cover the widest spectrum of motor vehicle
250,000
200,000
PASSENGER CAR AND SMALL CV MARKET IN HUNGARY 2009 - 2019 195,645 176,955
175,000 161,000
150,000
142,000
AVERAGE SALES FOR THE DECADE 123,000
Source: Ford Magyarország
New motor vehicle sales have been picking up dynamically in Hungary, with Ford keeping its supremacy nearly on all fronts. The company says numbers would be far more impressive, however, if legislation were used to cut mass imports of units of obsolete technology.
100,000
100,000
88,500 72,354 55,149
60,841
68,800
72,536
2012
2013
50,000
0
2007
2008
2009
2010
segments and our models rank high in nearly every category.” Accordingly, Ford can pride itself on scoring high in the Transit (light commercial cargo van) segment, but it also leads corporate fleet charts, as well as the nonpremium sports car and pick-up segments. Its supremacy is most apparent in the Small CV segment, where the American giant is responsible for selling almost every fourth motor vehicle in Hungary. Fiat is second placed, some 10% behind. A raft of new models scheduled for 2018 hints at a further market offensive by Ford. In total, ten brand-new or fully redesigned models will arrive, with all expected to do well, representatives of the car maker
2011
2014
“Our success is primarily due to the fact that we perform well not just in one single segment. We probably cover the widest spectrum of motor vehicle segments and our models rank high in nearly every category.” In the meantime, access to financing remains a major engine for further growth. Here Ford Credit, the brand’s in-house solution assumes a key role, and not just for new autos but used cars and insurance as well. Given the low interest environment, it should come as little surprise that retail customers have been seeking financing in doves: 20% of total new car sales involved Ford Credit.
Bottlenecks for Growth
Szamosi Viktor, managing director of Ford Magyarország said. However, Ford believes it would take a legislative change to enable another substantial breakthrough to happen. “In 2017 some
150,000 used cars
were imported, most of them of obsolete technical condition,” highlighted Szamosi. “Hungary is among the seven EU countries with no CO2-based taxing, so if stricter regulation came into force, it would surely have a market cleansing effect. In addition, new car sales could soar by up to 50,000 per year.”
2015
Improving sales figures goes hand-inhand with network expansion. Two Ford establishments have opened recently in Budapest and in Kaposvár, with two more expected to follow at some point in the near future. “It is not infrastructure but human capital that matters, though, as lack of talent causes bottlenecks for growth,” emphasized Attila Dalos, director of sales of Ford Magyarország. Accordingly, a comprehensive training program targeting technical and sales positions is underway under the guidance of consultancy Develor. It is positions requiring manual labor that are hardest hit by the labor shortage. “In Szentendre, our 500-strong headquarters is home to highly skilled employees and it has evolved into a European service center of finance, logistics and pricing. Just last year we recruited 100 new staff,” said Dalos. But if that is the good news, the talent pool is far shallower for mechanics. “The recent wage increases of up to 30% constitute only a short-term solution.
2016
2017
2018
2019
In the longer run, such manual labor professions must be made more attractive,” Dalos noted. The company has, therefore, launched its own nationwide career program, which aims to provide new blood and reestablish the reputation of being a car mechanic, in close cooperation with six secondary schools. But what about e-cars? The Ford Motor Corporation is well-known for being a champion in the field, and says it is
investing
USD 4.5 billion
into the technology up to 2020. As Szamosi said, big changes are to come about at around that time, but that won’t affect the normal product development curve. That implies that the appeal for cross-overs and SUVs is expected to continue to prevail. “I wouldn’t give too much thought to the e-revolution at this point, though,” Szamosi noted. “We’ve got other
“In 2017 some 150,000 used cars were imported, most of them of obsolete technical condition. Hungary is among the seven EU countries with no CO2-based taxing, so if stricter regulation came into force, it would surely have a market cleansing effect. In addition, new car sales could soar by up to 50,000 per year.” homework to do now; namely, why don’t we push the market towards having more modern Euro6 engines to start with and cut the number of imported used cars that are in bad shape dramatically? That would do as step one.”
3
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
Special Report The Year Ahead
2018 Likely to Bring Lively M&A Market 16-17 Wish List 2018: Ethics, Calmness and a Good Breakfast 18-19
What does the year ahead promise in terms of growth and M&A activity, and what is on our experts’ wish list?
16 | 3
Special Report
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
2018 Likely to Bring Lively M&A Market Favorable global economic and financial circumstances can accelerate both the global and the Hungarian M&A market, however, some argue that increases in economic nationalism, protectionism and restrictions on global trade and crossborder economic integration all have the potential to negatively affect deal-making sentiment.
equity valuations, and the prospect of cheaper financing in emerging markets. However, the report is quick to emphasize that uncertainty persists over potential protectionist measures in key economies. According to the forecast, M&A value could
exceed USD
ZSÓFIA CZIFRA
Global deal activity is likely to accelerate in 2018, caused by the easing of key economic and political risks and the emergence of positive macroeconomic deal drivers, states a report on the world’s M&A market. The third edition of the Global Transactions Forecast, developed jointly by Oxford Economics and Baker McKenzie, highlights why investors around the world are feeling increasingly confident for 2018, with appetites strengthened by positive trends such as more-buoyant world trade and economic growth, elevated
3 trillion
in 2018, while IPO (initial public offering) value could improve by more than 50% over 2017 to nearly USD 300 billion. Deal activity will peak in North America and Europe in 2018; the rest of world will follow in 2019, it says.
Cooler 2019
As for the further outlooks, the report says that a range of factors will cool deal activity from 2019 onwards particularly in developed markets, including higher interest rates, a cyclical easing in global trade and investment growth, and a correction in equity prices back towards fundamentals. The forecast predicts M&A
Growth Horizon The good outlook for the M&A market is underlined by the latest report issued by PwC. In its prediction for 2018, the company said that global economic growth was on track to be the fastest since 2011. In its main scenario, it projects the global economy will grow by almost 4% in purchasing power parity (PPP) terms, adding an extra USD 5 trillion to global output in current value terms. It also expects growth to be broad-based and synchronized, rather than dependent on just a few countries. The main engines of the global economy, such as the United States, emerging Asia and the Eurozone, which comprised 60% of world GDP in 2017, are expected to contribute almost 70% of economic growth in 2018 in PPP terms, compared to their post-2000 average of around 60%.
values to drop to USD 2.9 tln in 2019 and USD 2.4 tln in 2020. Another report, the Intralinks Deal Flow Predictor, which predicts future mergers and acquisitions (M&A) announcements, is even more specific. In its latest prediction, it forecasts that the number of worldwide M&A deals announced in Q1 2018 will increase by
around
2%
compared to Q1 2017. Intralinks foresees year-on-year growth in the number of announced M&A deals in three out of the four global regions, namely in Asia Pacific, the EMEA region, and in Latin America. In the Asia Pacific area, it sees a massive 14% increase, in EMEA (Europe, the Middle East and Africa), deal activity is expected to be up by 6%, while 3% y.o.y. growth is predicted for Latin America. In North America, on the other hand, M&A activity is expected to fall by 11%, due to an exceptionally strong first quarter in 2017. As for the EMEA region, Intralinks notes that two of the region’s largest M&A markets, the United Kingdom and Germany, are noticeably failing to contribute towards EMEA’s growth. M&A activity in Germany declined in 2017, with the number of announced deals in the first nine months falling by 8% y.o.y. German early-stage M&A activity also declined in Q3 2017, dropping by 10% on a yearly basis. In the United Kingdom, early-stage M&A activity in Q3 2017 fell by 5% y.o.y. For the rest of the region, the report states that the situation looks solid, with Eastern Europe, the Middle East, Africa, Northern Europe, Spain and Italy all showing double-digit increases in
early-stage M&A activity. The materials, real estate and healthcare sectors are predicted to lead the growth in EMEA M&A announcements over the next six months. Intralinks, however, also warns of risk factors. These are twofold: political and financial. According to Philip Whitchelo, VP of Strategy & Product Marketing at Intralinks: “Increases in economic nationalism, protectionism and restrictions on global trade and cross-border economic integration all have the potential to negatively affect deal-making sentiment. With global equity markets at record highs, and almost nine years since the last major trough, a correction that turns into a more serious sell-off could also prove negative for deal-making confidence.”
The Hungarian Picture
A livening deals market is anticipated in 2018 not only at a global level, but also domestically, by some experts. “We are expecting an active year on the M&A market globally and in Hungary as well,” Tamás Simonyi, senior director, head of CEE financial institutions M&A advisory at Big Four company KPMG told the Budapest Business Journal. Tendencies seen last year will likely continue and reach full potential this year, Simonyi says, noting that, like 2017, the property market will surely be a driving force for mergers and acquisitions. “The sale of several highvalue properties are under preparation at the moment,” he added. As for banks cleaning their nonperforming loan (NPL) portfolios, Simonyi said that, while the vast majority of portfolios have been sold already, there are some to be completed yet. He also added that some Hungarian-owned
www.bbj.hu
3
Budapest Business Journal | January 12 – January 25, 2018
Left: Ervin Apáthy, director of corporate finance at PwC Hungary. Right: Tamás Simonyi, senior director, head of CEE financial institutions M&A advisory KPMG. large corporations might change hands in the course of 2018, without revealing further details. Several foreign buyers will also likely appear on the market, however, the areas where their activity is focused is narrowed to those industries that are not of interest to the current administration. “Mainly companies in the manufacturing sector are likely to be targets of foreign acquisitions this year,” Simonyi said.
Lack of Will
While this year is forecast to be more active than 2017, the activity of Hungarian
companies making acquisitions abroad is still hardly detectable. Only very large companies might be seen on the global M&A scene, such as OTP Bank or Richter, Simonyi said. Medium-sized Hungarian companies, on the other hand, are still not able to nail down major deals abroad, he claims, explaining that, in many cases, they lack not the capital but the willingness to secure a foothold in a foreign market. An increasing number of private market deals are expected this year, Ervin Apáthy, director of corporate finance at PwC Hungary told the BBJ. “We think
that the number of large-scale deals are likely to increase, but not to a significant extent. Due to the favorable financial and economic conditions, we sense that several owners might have an increasing intention to sell, however, the biggest question, of course, is how the financial market will proceed in the future,” Apáthy explained. In his opinion, the traditionally strong sectors will continue to thrive this year: he expects transactions in the food industry, in the field of financial services and in the technology, media and telecom sectors. As for the role the Hungarian state might take on the M&A market, Apáthy believes that direct state participation on the market will not be too strong this year, due to the fact that 2018 is an election year. “According to our experiences, the campaign and the election itself almost entirely occupies the mind of political decision makers, and this shift in focus results in a decreasing number of economic and business decisions,” he said. However, while the players of Hungary’s business scene expect less state intervention this year, it does not mean that the activity of entrepreneurs with state connections will slow down, he added. Simonyi, on the other hand, think that the upcoming elections will not influence the Hungarian state’s appetite on the deals market. In his opinion, both the state and companies close to the current administration will continue be active in 2018. “The state’s intention, namely to be present in the strategically important sectors, will not likely change this year,” he said.
Special Report | 17 Regional Comparison As for a regional outlook, Ervin Apáthy told the BBJ that the upgrade of the Romanian M&A market is likely to continue if no major changes occur. Experience shows, however, that market swings are much more visible in Romania than in Hungary: upswings are more dominant and setbacks are also much more severe than in Hungary. Under normal circumstances, foreign companies looking for growth potential will find a larger-sized market attractive. Following Poland, Romania is the region’s second largest market, but, on the other hand, it also deals with deepening demographic problems. The positive evaluation of the Romanian market that was quite visible last year is mainly due to the economic growth the country produced, which was way above the EU average. This was induced by loosening financial politics and a boost in consumption. “For the time being, I do not see any factors that would change the current trends,” Apáthy concluded.
ADVERTISEMENT
FOOD AT IT’Sin Budapest BEST
• a business lunch review • best bakeries in Budapest • young talents of Hungarian cuisine
• the gastronomy market in Hold utca • over 100 recommended restaurants • provincial restaurants
Budapest’s Casual, Business & Fine Dining Please forward your subscription request to the following email address: circulation@bbj.hu. Copy price: 2 990 HUF.
18 | 3
Special Report
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
Wish List 2018: Ethics, Calmness and a Good Breakfast 2017 proved to be a dynamic year for many in the Hungarian business world, but that is already history; what might the next 12 months bring? The Budapest Business Journal has quizzed personalities from a wide variety of sectors to find out their hopes and aspirations for the Chinese Year of the Dog. KESTER EDDY
Hospitality Needs Convention Center, High-quality Training
Dr. Ákos Niklai
The plans are there, but they need final government approval. Such a center would make Budapest much more attractive for the MICE [Meetings, Incentives, Conferences and Exhibitions] segment. This would support higher revenues in the industry, which is necessary to improve the profitability of hotels and restaurants in Hungary. In the past year or two, the shortage of both skilled and unskilled labor has been a huge challenge for everyone in hospitality. In spite of significant increases in salaries and favorable business conditions, we are still unable to attract enough chefs and waiters of the right quality: in fact, even more of them have decided to work abroad! So, I want to see us work hard to improve the attractiveness and reputation of the industry, with an increased emphasis on the quality of both vocational and high-level education to meet demands.
Christians by Deed, not Word
Past president of the Hungarian Hotel and Restaurant Association, VP Business Hungary (MGYOSZ) . mgyosz.hu/en/index.php 2017 was another successful year for both in-bound and domestic tourism. In-bound showed steady growth from all international markets, with major sports events such as the FINA World Championship [swimming] and Formula 1 making significant contributions. Budapest continues to remain one of the most popular and safe cities in Europe, and is increasingly becoming a successful destination for conference and [what we term] incentive [i.e. corporate reward] tourism. However, I – like everyone in the industry – believe there is a need for a big convention center in Budapest, which would significantly help to boost revenues. This needs to have a capacity of around 5,000, as opposed to our largest venue currently of 1,500 or so.
Dr. Frank Hegedűs The Rev. Dr. Frank Hegedűs, Chaplain and Area Dean, Saint Margaret’s Anglican Episcopal Church, Budapest anglicanbudapest.org
I suppose a cleric like me is more likely to have a New Year’s prayer than wish, although the cynics among us might question the efficacy of either. Still, in times like these, why take chances…? So, my fervent prayer for 2018 is that we Christians throughout the world preach the Gospel by action more than word; that truth at long last be sorted from fiction; and that everyone just learns to relax a bit. Nyugi…
Ex-pats, Jobs Await You!
Zsuzsa Kecsmar
Communications Faces Ethical Challenges The public relations industry has been facing new challenges in the past few years from social media and fake news to so-called “influencer PR” (where companies use a celebrity to praise their brand or products) and “native advertising” – paid-for text seeming to be independent editorial. The latter two in particular both raise ethical questions. In 2018, I hope and expect the industry to improve its reaction to these challenges and emerge stronger from the communication competition than ever before. The key players of the PR-market must cooperate to find and protect a strong position in the communication arena. I am also a passionate advocate for strengthening the role of corporate social responsibility. This just makes good sense, whatever the size of your company. Happy employees work better. I hope to see the Hungarian government take the lead in this, and encourage real cooperation with companies to spread the idea of ethical business behavior and corporate citizenship. In the long-run, Hungary will only be successful business-wise if ethical business models are followed – and expected – by everyone. Any other way will eventually lead to poor performance levels and disappointment. This country
Zsuzsa Kecsmar is co-founder and chief operating officer of Antavo, a retention marketing software for retailers and brands. antavo.com We’re based in Szeged, and in the past year I think most companies have been feeling the labor market is very tight when it comes to recruiting people with the right skills. We’ve expanded from 12 to 22 employees over the last year, and we got to hire some people who wanted to move back home after years of working abroad. It’s great that their expertise can help us today. Our company operates on the global market, and it is hard to find colleagues in, for example, marketing, sales and client-facing roles who have previously done anything like what we’re doing. Hungary is a small country and a small market, so companies here mostly haven’t been able to grow that big, unlike, say Poland, where four times as many people live; that means four times more opportunities for local companies. I believe larger companies produce a more qualified workforce, with broader experience. However, I think there are more and more companies like us, which are working globally, which means great potential but also international competition. I think this also helps develop highly-skilled professionals. I really hope all companies can find the right people in 2018, but I do wonder if it might be tougher recruiting this year. We will certainly need more skilled professionals ourselves.
Zsófia Lakatos Zsófia Lakatos is president of the Hungarian Public Relations Association, founder and CEO of Emerald Public Relations emeraldpr.hu needs good people, good companies and good and ethical communications. I hope we advance on these fronts in 2018.
Face Security Issues Calmly and in a Timely Way As a player in the IT industry, I hope people will stop fearing and dreading the security risks we face every day, and begin to face up to them calmly and professionally – become fully security conscious. This way we can negate threats most effectively and efficiently.
www.bbj.hu
3
Budapest Business Journal | January 12 – January 25, 2018
Szabolcs Kun Szabolcs Kun is CEO and founder of Arenim Technologies, the Swedish-Hungarian provider of the award-winning CryptTalk voice call-encryption software.
Education for Application, not Tick Box
www.arenim.com/about_us As a manager, I hope to keep a strict work-life balance this year, even when rushed, and to meet satisfied people around me – at my company, in my family and among my friends.
An Austrian’s Hopes for Hungary: Breakfast and Service As an Austrian who has lived here for 29years, my wishes for Hungary in 2018 are: Back to the future! I wish that Hungary comes back into the heart of Europe, because that’s where the future lies. As a convinced European and in love with the country, I can only say “Hungary we want you back! Hungary, we really miss you!” as a partner for our common European future. It is fine to be critical and demand change and improvement, but be at the heart of Europe and show it.
Klemens Wersonig Klemens Wersonig, founder & CEO, TARGET Executive Search, a regional head-hunting company, headquartered in Budapest targetexecutivesearch.com
INSIDE VIEW
Legal Challenges of HR-related Big Data Analysis Dr. Zoltán Tarján
Senior Associate
BIRD & BIRD
The digital age has seen the creation of a huge amount of data, with so-called big data posing challenges as well as opportunities for organizations. Big data analysis can be a real advantage in the field of HR: it can provide a more effective recruitment process, help identify overused or unexploited departments, and thus improve HR planning. Big data analysis inevitably raises data protection legal issues that should be addressed under the provisions of the EU General Data Protection Regulation (GDPR), applicable from May 25, 2018. One of the crucial issues is what the legal basis for profiling and automated decision making can be.
Profiling
Article 4 (4) of GDPR defines profiling as:
Agnes Elam Agnes Elam is associate professor, at the department of International Studies, Budapest Metropolitan University. metubudapest.hu I would like to see academic and higher education more directed to the needs of a modern Hungarian economy, including the digital economy. For example, in our secondary schools there should be more focus in the national curricula on application of knowledge, rather than on knowledge for its own sake. Also, we should further enhance teacher training with a focus on key economic innovative sectors, along with more EU and international cooperation. I’d like to see more talented Hungarian and international students not only in top-level studies in Hungary, but then staying on here to make the economy stronger. There should be more incentives to increase student and educational exchanges between Hungarian higher education and international toplevel universities. The Hungarian economy would then benefit more from international technological spillovers and it would enhance Hungary’s attractiveness for international research and development projects. Nothing else, except health and happiness for my colleagues and students all over the world!
“any form of automated processing of personal data consisting of the use of personal data to evaluate certain personal aspects relating to a natural person, in particular to analyze or predict aspects concerning that natural person’s performance at work, economic situation, health, personal preferences, interests […].” We believe that big data analysis of workforce effectiveness and decision making (e.g. reorganization) based on such analysis typically qualifies as profiling under the GDPR. Pursuant to the guidelines of the Article 29 Data Protection Working Party (WP29), issued on October 3, 2017, profiling can be based on the consent of the data subject, the legitimate interest of the data controller or a third party, and on other legal bases as well. Consent of the data subject is an inappropriate legal basis for profiling in the case of employees, due to the imbalance of power between employers and employees. We believe that performance evaluation and increasing efficiency can qualify as the employers’ legitimate interest; however, WP29 stresses that several aspects must be taken into account by employers during the balancing exercise, e.g., the level of detail and comprehensiveness of the profile, the impact of profiling and the safeguards. In the WP29 opinion, a legitimate interest can be the basis for profiling, if the profiling is reasonable and can
be anticipated by employees. However, extensive profiling using data collected in other contexts and for other purposes cannot be conducted based on legitimate interest. Currently, it is not easy to provide clear-cut advice on the legal basis for HR-related profiling. However, authority practice and the European Data Protection Board’s guidelines should provide clarification after May 2018.
Automated decision making Article 22 (1) of GDPR states that
“the data subject shall have the right not to be subject to a decision based solely on automated processing, including profiling, which produces legal effects concerning him or her or similarly significantly affects him or her.” WP29 emphasizes that the above is a general prohibition and automated decision making is possible only in case of exceptions specified in Article 22 (2) of GDPR. In WP29’s view, e-recruitment clearly qualifies as automated decision making. Additionally, other HR related big data analysis can also qualify as automated decision making, e.g., if the employee is dismissed as a result of evaluating his performance, provided that the decision is made without human intervention. As noted above, there are exceptions from the prohibition: automated decision making is lawful if it is (i) based on the explicit consent of the data subject, or (ii) necessary for the conclusion or performance of a contract between the data controller and the data subject, or (iii) authorized by EU or member state law. Therefore, explicit consent of a job applicant can be a legal basis for automated decision making in the case of e-recruitment. WP29 points out that the necessity for the conclusion of a contract must be interpreted narrowly. Thus, explicit consent is probably the only appropriate legal basis for e-recruitment. There might be problems in the case of automated decision making affecting employees. Consent is inappropriate in the case of employees, due to the imbalance of power. Additionally, the two other remaining legal bases can also be problematic: currently there are no HR-related laws authorizing automated decision making, and it is difficult to argue that the automated evaluation of employees’ performance or effectiveness is necessary for the performance of an employment contract.
www.twobirds.com www.twobirdsideas.hu
NOTE: ALL ARTICLES MARKED INSIDE VIEW ARE PAID PROMOTIONAL CONTENT FOR WHICH THE BUDAPEST BUSINESS JOURNAL DOES NOT TAKE RESPONSIBILITY
Wake up Budapest! Good breakfast places are still missing in the city. You may say that there are quite a few around, and some even serve breakfast all day. Yes, but most open too late, at 8:30 or even later. A breakfast place must open at 7 a.m. at the latest. In German, it is called Frühstück, it means early bite, otherwise we would call it Spätstück. Good service competition! I wish that Hungary could implement a competition for the best service. We all, the consumers, should be able to vote with an app and then have the Oscar for the best supermarket, coffee shop, restaurant, you name it. What a consumer revolution that would be!
Special Report | 19
20 | 3
Special Report
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
Stockbrokers(1) Ranked by total assets
tRade WitH FoReigN sHaRes
aNalysis
FUNd maNagemeNt
deRivatives
CURReNCy
mUNiCipality boNds
CoRpoRate boNds
goveRNmeNt boNd tRade
CompaNy Website
eqUity tRade
total assets iN 2016 (HUF blN)
RaNk
sCope oF aCtivities
oWNeRsHip (%) HUNgaRiaN NoN-HUNgaRiaN
top loCal exeCUtive CFo maRketiNg diReCtoR
addRess pHoNe Fax email
sándor Csányi – –
1051 Budapest, Nádor utca 16. (1) 473-5000 (1) 312-6858 otpbank@otpbank.hu, informacio@otpbank.hu
1
otp baNk NyRt.
7,109
✓
✓
✓
✓
✓
✓
✓
✓
✓
Individuals and Corporate (25.5), other (2.5) Individuals and Corporate (72)
2
UNiCRedit baNk HUNgaRy ZRt.
2,834
✓
✓
✓
–
–
✓
✓
✓
✓
– UniCredit S.p.A. (100)
mihály patai Liliana Beric József Sipos
1054 Budapest, Szabadság tér 5-6. (1) 301-1271 (1) 353-4959 info@unicreditbank.hu
3
mkb baNk ZRt.
✓
METIS Magántőkealap (45), Pannónia Nyugdíjpénztár (10), other (15) Blue Robin Investments S.C.A. (30)
Ádám balogh – –
1056 Budapest, Váci utca 38. (1) 327-8600 (1) 327-8700 telebankar@mkb.hu
4
RaiFFeiseN baNk ZRt.
2,001
✓
✓
✓
✓
✓
✓
✓
✓
✓
– Raiffeisen-RBHU Holding GmbH (100)
györgy Zolnai – –
1054 Budapest, Akadémia utca 6. (40) 484-848, (1) 484-8484 (40) 484-4444 info@raiffeisen.hu
5
Cib baNk ZRt.
1,665
✓
✓
✓
✓
✓
✓
✓
✓
✓
– Intesa Sanpaolo S.p.A (100)
pál simák Andrea de Michelis –
1027 Budapest, Medve utca 4–14. (1) 423-1000 (1) 489-6500 cib@cib.hu
6
iNg baNk N.v. magyaRoRsZÁgi Fióktelepe
561
✓
✓
Ÿ
Ÿ
Ÿ
✓
–
✓
✓
– ING Bank N. V. (100)
tibor bodor Gyula Réthy –
1068 Budapest, Dózsa György út 84/B (1) 235-8700 (1) 269-6447 ing@ing.hu
7
FHb baNk ZRt.
–
FHB Jelzálogbank Nyrt. (100) –
márton oláh – –
1082 Budapest, Üllői út 48. (1) 452-9100 (1) 329-1004 info@fhb.hu
8
eRste beFektetési ZRt.
✓
Erste Bank Hungary Zrt. (100) –
Róbert Cselovszki, géza Ráner – –
1138 Budapest, Népfürdő utca 24-26. (1) 235-5100 (1) 235-5190 erstebroker@erstebroker.hu
károly Régely – András Szabadi
1123 Budapest, Alkotás utca 50. (1) 489-2200 (1) 489-2201 info@con.hu
www.otpbank.hu
www.unicredit.hu
2,099
www.mkb.hu
www.raiffeisen.hu
www.cib.hu
www.ing.hu
464
www.fhb.hu
www.erstebroker.hu
156
✓
✓
✓
✓
✓
✓
✓
–
✓
–
–
✓
✓
✓
✓
✓
–
✓
✓
✓
–
✓
✓
✓
9
CoNCoRde éRtékpapíR ZRt.
47
✓
✓
✓
–
✓
✓
✓
✓
✓
TC Befektetési Nyrt. (30), Eurotipp Szaktanácsadó Kft. (11), Individuals (19) Blackburn International Inc. (10), ZÜRICH INVESTMENTS INC. (10) TEATIME GROUP. INC (10), Blackburn International Luxembourg (10)
10
eqUiloR beFektetési ZRt.
19
✓
✓
✓
✓
✓
✓
✓
✓
✓
Individuals (68), TOPERINI Hungária Kft. (15) ECM Holding Ltd. (17)
andrás gereben, bálint szécsényi Tímea Schuck –
1037 Budapest, Montevideo utca 2/C (1) 430-3980 (1) 430-3981 equilor@equilor.hu
11
spb beFektetési ZRt.
✓
SPB Management Tanácsadó Kft. (100) (-)
tamás parádi-varga – –
1051 Budapest, Vörösmarty tér 7–8. (1) 483-2610 (1) 483-2615 info@spbinvest.hu
12
RaNdom Capital bRokeR ZRt.
Nándor tóth, Ferenc virág – –
1053 Budapest, Szép utca 2. (1) 501-3333 (1) 700-2900 info@randomcapital.hu
NR
kbC seCURities magyaRoRsZÁgi Fióktelep
györgy Zsolt Herczku, Ádám Hegyi – –
1095 Budapest, Lechner Ödön fasor 10. (1) 483-4000 (1) 483-4001 info@kbcsecurities.hu
www.con.hu
www.equilor.hu
www.spbinvest.hu
www.randomcapital.hu
www.kbcsecurities.hu
Ÿ= would not disclose, NR = not ranked, NA = not applicable
6
✓
–
–
–
–
–
–
✓
3
✓
✓
–
–
–
✓
–
✓
✓
Individuals (77.50), ARX Egészségügyi Központ Kft. (22.50) –
Ÿ
✓
✓
✓
✓
✓
✓
✓
✓
✓
– KBC Securities N.V. (100)
This list was compiled from responses to questionnaires received by January 10, 2018 and publicly available data. Data is based on companies’ own data revelations. To the best of the Budapest Business Journal’s knowledge, the information is accurate as of press time. While every effort is made to ensure accuracy and thoroughness, omissions and typographical errors may occur. Additions or corrections to the list should be sent on letterhead to the research department, Budapest Business Journal, 1075 Budapest, Madách Imre út 13–14., or faxed to (1) 398-0345. The research department can be contacted at research@bbj.hu
Notes: (1) Data from the database of Hungarian Financial Supervisory Authority-National Bank of Hungary.
www.bbj.hu
Special Report | 21
3
Budapest Business Journal | January 12 – January 25, 2018
Venture capital firms
4
kaeRous koCkázati Tőkealap-kezelő zrT.
100 2013
www.krscapital.hu
5
x-ventuRes alpHa zRt.
6
pRimus Capital zRt.
7
www.x-ventures.hu
www.primuscapital.hu
Finext staRtup koCkázati Tőkealap-kezelő zrT.
249
Ÿ
–
–
✓
✓
–
–
✓
–
–
6,441
X-Ventures Alpha I. Kockázati Tőkealap, Budapest, 2010; X-Ventures Béta Kockázati Tőkealap, Budapest, 2013
176
100 2010
Viktor Nyíri, Imre BativaiSchüle
✓
–
✓
✓
✓
✓
✓
✓
–
Ÿ
Primus III, 2010
100 2010
160
7,360
Finext Startup Kockázati Tőkealap Budapest, 2009
100 2010
150
www.finext.hu
8
9
pbg FmC koCkázati Tőkealap-kezelő zrT. www.pbgfmc.hu
FinateCH Capital koCkázati Tőkealap-kezelő zrT.
10
11
www.abcventurecapital.com
dbH investment koCkázati Tőkealap-kezelő zrT.
ieuRope kFt.
www.ieurope.com
inFoRmatikai koCkázati NR Tőkealap-kezelő zrT. www.iktk.hu
Ÿ
Ÿ
✓
–
✓
–
–
–
✓
✓
✓
✓
✓
✓
✓
–
✓
✓
✓
✓
–
✓
✓
✓
✓
✓
✓
✓
✓
–
–
✓
✓
✓
–
–
✓
–
✓
kornél kisgergely – –
1027 Budapest, Kapás utca 6–12. (1) 452-5700 (1) 452-5702 info@ckta.hu
✓
–
2011 28
Hungarian State (100) –
imre v. Csuhaj – –
1072 Budapest, Rákóczi út 42. (1) 413-2740 – info@szta.hu
✓
Biotechnology, life sciences
2008 13
OTP Bank Nyrt. (100) –
andrás molnár – –
1123 Budapest, Alkotás utca 53. (1) 298-3370 (1) 298-3303 info@portfolion.hu
–
✓
Healthcare, loigistics, fleet management
2012 4
Bret Invest Kft. (100) –
ákos almási – –
1044 Budapest, Megyeri út 53. (30) 418-3470 – info@krscapital.hu
✓
✓
Healthcare
2007 9
NV Vagyonkezelő Kft. (100) –
levente zsembery Attila Pechtol –
1023 Budapest, Lajos utca 28-32. (1) 412-2618 (1) 412-2616 info@x-ventures.hu
–
2007 4
Ÿ Ÿ
zoltán bruckner István Alpek András Szombati
1012 Budapest, Pálya utca 9. (1) 225-1162 (1) 225-1163 info@ primuscapital.hu
–
2008 4
Individuals (100) –
iván Halász, Ferenc lévay – –
1025 Budapest, Nagybányai út 92/A (1) 783-3749 (1) 783-3849 finextstartup@ finextstartup.hu
Piarista Iskolaépítő és Fenntartó Nonprofit Kft., PORTUS BUDA GROUP Befektetési és Vagyonkezelő Zrt. (100) –
elemér eszter – –
1024 Budapest, Lövőház utca 9. (1) 488-7476 – iroda@pbgfmc.hu
–
✓
✓
✓
✓
✓
–
Ÿ
106
Ÿ
FINATECH I. Kockázati Tőkealap
100 2013
Ÿ
ABC Kockázati Tőkealap Magyarország
100 2014
5,000
DBH Investment Kockázati Tőkealap; Budapest; 2010
100 2010
MFB Zrt.
✓
–
✓
✓
–
–
✓
–
–
–
–
Ÿ
iEurope Fund, Delaware, USA, 2012
5 2012
Ÿ
✓
–
✓
✓
✓
–
✓
✓
–
✓
✓
96
91
50
Ÿ
Ÿ
Ÿ
100 2014
Ÿ
–
–
✓
✓
–
Ÿ Ÿ Ÿ Ÿ Ÿ Ÿ
Ÿ
–
–
✓
✓
–
✓
Ÿ Ÿ
Ÿ
Ÿ
✓
–
✓
✓
–
Ÿ Ÿ Ÿ Ÿ Ÿ
–
–
✓
✓
✓
–
✓
–
–
–
–
–
–
–
✓
✓
–
otHeR
MFB Invest Zrt. (100) –
✓
pRoduCtion
1999 53
media
FinanCe
FmCg
it
teleCom
expanding FiRms ✓
Electronics, waste processing, renewable energy, food industry, creative industry
146
www.dbh-group.com
12
Ÿ
–
✓
addRess pHone Fax email
PBG FMC Kockázati Tőkealap
www.finatech.hu
abC koCkázati Tőkealap-kezelő zrT.
2011
–
✓
eaRly stage Companies
7,150
Kairos Növekedési Kockázati Tőkealap, Kairos Magvető Kockázati Tőkealap
www.portfolion.hu
–
–
staRtup Companies
Ÿ
✓
laRge Companies
Ÿ
OTP Kockázati Tőkealap I., 2010; Budapest PortfoLion Regionális Magántőke Alap, 2012; OTPDayOne Magvető Tőkealap, 2013
Ÿ
medium Companies
100 2012
investoRs oF most ReCent Fund
Ÿ
Széchenyi Tőkebefektetési Alap
Ÿ
top loCal exeCutive CFo maRketing diReCtoR
419
98 2006
oWneRsHip (%) HungaRian non-HungaRian
poRtFolion koCkázati Tőkealap-kezelő zrT.
420
Ÿ
MFB Innovációs Tőkealap, MFB Zöld-gazdaság Tőkealap, MFB Növekedési Tőkealap
taRget industRies
yeaR establisHed no. oF Full-time employees on July 1, 2017
3
www.szta.hu
pRopoRtion oF investments in HungaRy aFteR 1990 (%) yeaR oF FiRst investment in HungaRy
2
széCHenyi Tőkealap-kezelő zrT.
www.ckta.hu
955
CentRal and easteRn euRopeans Funds
1
HiventuRes koCkázati Tőkealap-kezelő zrT.
taRget Companies
Capital managed in CentRal and easteRn euRope on July 1, 2017 (HuF mln)
Company Website
total net Revenue in 2016 (HuF mln)
Rank
Ranked by total net revenue
–
2011
Ÿ
–
2012 8
FINATECH Kft. (100) –
Csaba gégény – –
1138 Budapest, Váci út 188. (1) 353-6260 (1) 890-0891 info@finatech.hu
–
2013 4
Individuals (100) –
benedek lőrincz – –
1012 Budapest, Márvány utca 16. (1) 781-1808 (1) 781-8942 info@ abcventurecapital.com
Healthcare
2008 4
– DBH Group B.V. (100)
sándor erdei – –
1027 Budapest, Kacsa utca 15–23. (1) 803-7900 (1) 803-7901 investment@ dbh-group.com
–
1998 2
– IEUROPE Capital LLC (100)
lászló Czirják – –
1025 Budapest, Csalán utca 4/A (1) 200-4015 (1) 200-5707 hatosag@sz-k-t.hu
2002 1
Kecskemét municipality (100) –
lajos dobrai, Csaba Jakab, balázs garamvölgyi – –
1027 Budapest, Kapás utca 6–12. (1) 600-6533 (1) 600-6531 iktabo@iktk.hu
–
4 22 | 4
Socialite
www.bbj.hu
Socialite
Budapest Business Journal | January 12 – January 25, 2018
Botond Horváth/Shutterstock.com
Discover Budapest’s Gingerbread City
David Holzerʼs New Year resolutions see him cultivating an interest in that festive speciality, mézeskalács, or gingerbread. DAVID HOLZER
My New Year’s resolution is to really take advantage of Budapest’s rich cultural scene this year, so I’ve been checking out current and up-and-coming exhibitions. I’ll definitely be visiting “Within Frames – The Art of the Sixties in Hungary (1956-68)” at the Hungarian National Gallery. This is the first exhibition to offer a comprehensive picture of Hungarian art in that period, bookended by the defeat of the Hungarian Revolution and the Prague Spring. In Hungary at this time, cultural works were classified according to the “Three T’s” of Tiltott, Tűrt, and Támogatott (for “Forbidden”, “Tolerated” and “Supported”). The exhibition shows how, despite these restrictions and a general feeling of disillusionment, artists in the period continued to experiment and find new ways to express themselves. But, before I educate myself at this no doubt fascinating exhibition, I’ll be skipping off to visit the Gingerbread City at the Bálna Shopping Mall and Cultural Center, which has free entry and runs until
January
27.
Gingerbread houses
I don’t know about you, but when I think of gingerbread I immediately think of “Hansel and Gretel”, the wonderfully nasty fairy tale by the Brothers Grimm. But it’s debatable whether gingerbread houses actually existed before the fairy tale was written and published in 1812. In the original version of the story, the house is described as having bread walls and a roof of cake but no more. Despite this, after the book was published, German bakers began making gingerbread houses called Lebkuchenhaus or Pfefferkuchenhaus which became popular at Christmas. Since then, gingerbread buildings have grown more and more ambitious. Ever since the Nixon administration in the early 1970s, an enormous gingerbread house has appeared in the White House every year at Christmas. These began as standard German-style houses but, in recent years, have evolved into highly detailed creations, including a gingerbread White House covered in white chocolate. The Guinness World Record for a gingerbread house was set in 2013 when a group in Bryan, Texas made a 2,520-square foot house in aid of a hospital trauma center. Its estimated calorific value was thought to be more than 35.8 million, with
7,200 eggs
If you’ve ever visited a Hungarian souvenir shop or food fair, you’ll have seen mézeskalács. Often made at Christmas, these beautifully decorated cookies, often heart-shaped, are traditionally decorated with classical Hungarian designs, and are often arranged around a small square of mirror, which is meant to represent true feelings and a pure spirit.
And, who knows, I may well erect my own gingerbread building.
A Brief History of Gingerbread
Rise of the Gingerbread City
The custom of making spicy bread is believed to have been introduced to Europe at the end of the
I had no idea gingerbread cities existed, but it turns out that they’re quite the phenomenon. Pepperkakebyen, which currently claims to be the largest, is in Bergen, Norway, and has been under construction since 1991. Apparently, it contains everything from “international signature buildings” to local landmarks as well as gingerbread people. I’m not sure when Hungary’s first gingerbread city was constructed. But, given the country’s centuries-old association with gingerbread, it’s not surprising that Budapest now has its own.
Perhaps the biggest indicator of gingerbread’s significance was the fact that it was often worn as protection in battle and to ward off evil spirits.
11th century
by crusaders coming back from the Middle East. As well as being delicious, ginger helped preserve the bread. By the 13th century, gingerbread was being shaped into different forms and the custom spread across Europe. In the 1600s, Nuremberg became known as the “Gingerbread Capital of the World” when its master bakers began to create intricate designs on carved boards. The first documented appearance of gingerbread people comes in the 16th
century when Elizabeth I of England had them made in the likeness of some important visitors. Given Elizabeth’s ruthless reputation, I wonder how the dignitaries felt about being offered miniature gingerbread versions of themselves to eat. I can picture Elizabeth’s beady eyes as she picked out a gingerbread man that resembled a particularly troublesome diplomat and offered it to the man himself. (Incidentally, because of her love of sugar, which had only just arrived in Britain from the Colonies, Elizabeth had terrible teeth. Many had fallen out, making her speech hard to understand, and the rest were blackened and rotting. She later had all her teeth removed and only ever appeared in public with her mouth padded with cotton. Let that be a lesson to you, kids.) By the 17th century, gingerbread baking had become a recognized profession. Apart from at Christmas and Easter, only authorized bakers were allowed to bake it. Gingerbread was also sold outside churches on Sundays. At the same time, making gingerbread became a popular art form across Europe, with gingerbread molds depicting actual events.
used to make it. Until I make it to Gingerbread City, I can’t vouch for how impressive it may or may not be. But visiting the exhibition, especially if you have children, is also a great reason to visit the Bálna itself. Opened in 2013, the Bálna is a futuristic-looking glass and metal structure in the shape of a whale ( bálna is Hungarian for whale), designed by Kas Oosterhuis, and wrapped around a historic building. Apart from the Budapest Gallery, the Bálna houses bars, including the Jónás Craft Beer House which brews Hungarian beers and also offers exceedingly good coffee. There are also shops selling Hungarian delicacies and organic food. The development of the building is a somewhat chequered story. With the contracts disputed, it was eventually taken over by city hall. After running the venue for several years, the city council voted to put the Bálna up for sale in September. It was announced in December that the government will buy the building. After you’ve explored the Bálna, the walk down the river back towards the center of Budapest offers one of the most atmospheric waterfront cityscapes anywhere in the world. Find out more about “Within Frames” at www.mng.hu and the Bálna at www.balnabudapest.hu.
4
www.bbj.hu
Budapest Business Journal | January 12 – January 25, 2018
Socialite | 23
A Very Pannon Party Puts Local Grapes in Focus The Christmas tasting of the Pannon Wine Guild, an association comprising many of Hungary’s leading winemakers, was full of festive cheer and merriment as the wine flowed, and it also saw the vintners enjoying each other’s wares and posing for a series of impromptu team Pannon photos. ROBERT SMYTH
At the event, held on December 14 at the Corinthia Hotel Budapest, each producer was permitted to exhibit two wines, with the cheeky (and welcome) third occasionally popping out from under the table. The annual Pannon Christmas tasting marks a rare opportunity to catch up with the likes of Imre Györgykovács in the flesh. The winemaker, who rarely ventures out of Somló, Hungary’s smallest wine region although home to some of the biggest white, was pouring his single varietal Furmint and Hárslevelű wines from the 2015 vintage, assisted by his wife Gyöngyi. The Furmint had pure varietal character with hazelnut, quince, lime zest, lemon, and green herb notes, with the grape’s (Somló’s) trademark high acidity, and a certain stoniness on the finish. This wine was named the best white wine
of
2017
by the Circle of Hungarian Wine Writers earlier this month. (The best red title, incidentally, went to Villányi Cuvée Csanád, made by Csaba Koch). Györgykovács Hárslevelű 2015 distinguishes itself from
The vineyards of Somló lie on an extinct volcano, the soils of which leave a distinctive acidity to the grapes grown there. the Furmint with a varietally typical floral note and more generosity on its fruitier palate, while it is also quite flinty. Hárslevelű is no longer languishing in the shadow cast by Furmint, and is making dry wine that is every bit the equal of its much more coveted pair (the two work so well together in tandem in sweet Tokaj Aszú). From Tokaj, Stephanie Berecz, who is the French winemaker of Kikelet, the family winery that she runs together with her husband Zsolt, who tends the vineyards, brought Hárslevelű Lónyai dűlő 2015. This wine is a prime example of how complete a dry Hárslevelű can be. Furthermore, it comes from the loess soils of Tarcal, rather than the more volcanic soils of other parts of the Tokaj region. It certainly shows how elegant and rounded the wine from loess can actually be, despite the wrong assumption by some that only mediocre wines can be made from such soil.
Selling Up
Tamás Pók from Eger showed his skill as a winemaker in coaxing more complexity out of the usually neutral Leányka grape, which is one of the parents of the generally more exciting Királyleányka (the other parent being Grasa). His Leányka Superior 2014 saw prolonged skin contact of five days, along with lees stirring, and the result is far from neutral but rich and unctuous with good mouthfeel and distinctive sour fruit. A very nice dry white wine from what was a very challenging wet and cool vintage. The 60-year-old Pók has decided it’s time to sell the winery he slowly but surely built up on leaving his position as chief winemaker
for the Nimród Kóvács winery. The asking price
is HUF
150 million
for a house, two cellars (one traditional and one recently built, both have equipment, bulk and bottled wine stock) and 6.2 hectares of vineyards, scattered across some prime spots including Pajdos, Sikhegy and Nagy Eged Hill, which have only been sprayed with natural treatments, such as copper, sulfur and orange oil for years. Also in Eger, Tibor Gál impressed with his fresh, fruity and focused Kékfrankos 2013 with its pure red and some black fruit, with sour cherry the most prominent. Kékfrankos, which is typically a medium-bodied red, forms the backbone of the Bikavér (Bull’s Blood) blend, with some meat typically added to the bones by more full-bodied international varietals.
Indeed, Tibor Gál’s Egri Bikáver Superior 2013, which is a blend of Kékfrankos, Syrah, Cabernet Sauvignon, Kadarka, Pinot Noir, Merlot and Cabernet Franc from the Pajados, Síkhegy, Tornyos and Gróber vineyards, was richer than his Kékfrankos, but nicely retained its zestiness and freshness. Local Kadarka is used to add some aromatic spice and zip to Bikavér, which is especially true in Szekszárd but also increasingly in Eger wines (such as in Gál’s) where the hard to cultivate grape is being progressively reintroduced after falling out of favor in communist times. From Szekszárd, Péter Vida wowed with his subtle but spicy Öregtőkék (Old vine) Kadarkája 2015. Meanwhile, other impressive Kékfrankos examples showcased Hungary’s most planted red grape’s ever improving quality, which is now starting to rival Blaufränkish (the same grape) from across the Austrian border in the Burgenland. These came from ethnic Hungarian Frigyes Bott from Muzla in the Kürti wine region, close to Esztergom but which also crosses over the border into Slovakia (his Furmint 2015 was also highly representative of the grape), and Zoltán Heimann from Szekszárd, with the old vine Alte Reben Kékfrankos 2015. Note that the Heimanns are descended from Swabian Germans, hence the use of old vines auf Deutsch! Pannonhalma, in the northwest, may be a relatively cool region for Hungary but it can nevertheless be the source of some excellent red wine. Pannonhalmi Apátsági Pincészet’s flagship red Infusio, a blend of 80% Merlot and 20% Cabernet Franc from the Babszökő vineyard, struck a very nice balance between tension and substance, though it lacked some of the 2013 version’s intensity and power.
ADVERTISEMENT BBJournal.18.jan:Layout 1 12/19/17 3:13 PM Page 1
CARNIVAL WITH BUDAPEST RAGTIME BAND 1036 Bp., Kiskorona u. 7. Phone: +36 1 2500288 3th February 8-12 p.m. Ticket: obudaitarsaskor.hu jegymester.hu THE SIMPLICISSIMUS CHAMBER ENSEMBLE 10th February 7 p.m.
GERMAN AND FRENCH BAROQUE GAMBA MUSIC Sándor Szászvárosi, Réka Nagy – viola da gamba Rita Papp – harpsichord 15th February 7 p.m.
ANNIE FISCHER SCHOLARS László Nyári – violin, Barnabás Baranyai – cello Marcell Szabó – piano 16th February 7 p.m.
JAZZ VARIATIONS ON CLASSICAL PIECES Norbert Káel, József Balog – piano 26th February 7 p.m.
GUITAR MUSIC IN ÓBUDA Dávid Pavlovits – guitarist, composer 28th February 7 p.m.