Hungary's Malev airline ends flights due to imminent bankruptcy

Feb 3, 2012, 7:43 GMT

Budapest - Hungarian airline Malev ended its services early Friday, announcing the decision on its website, after the government issued bankruptcy protection for the state-owned carrier earlier this week.

'From February 3, 6 am (0500 GMT), after almost 66 years of continuous service, no more Malev aeroplanes will take off,' chief executive Lorant Limburger wrote on Malev's website.

Malev was facing a growing risk of insolvency following reports that the company was approaching bankruptcy, Limburger wrote, adding that suppliers had demanded upfront payment 'from one day to the next,' making the airline's position 'untenable.'

Malev has faced financial difficulties for several years. Earlier this year, the European Union's executive ordered Hungary to recover millions of euros in state aid to the troubled airline, as the transfers violated EU competition rules.

Following the decision, Budapest ceased all its financial aid to Malev.