Spain's leftist government blocked a takeover bid from a Hungarian consortium for Spanish train manufacturer Talgo on Tuesday, citing national security and public order risks. The economy ministry stated that the cabinet had decided "not to authorize direct foreign investment" in Talgo by Hungary's Ganz Mavag Europe due to concerns about strategic interests and national security.
Talgo, considered a strategic enterprise in a sector crucial to Spain's economic security and industrial development, has close ties with Spanish state railway company Renfe. The government did not explicitly mention its concerns about the Hungarian companies' links to Prime Minister Viktor Orban, who is seen as an ally of Russian President Vladimir Putin.
Orban, currently holding the EU presidency, sparked widespread anger across the bloc by meeting with Putin in Moscow shortly before a Russian missile attack on a Kyiv hospital. Talgo, founded in 1942, is known for its innovative wheel system and exports to several countries including Germany and the United States.
In response to the Covid pandemic, the Spanish government strengthened its powers to block foreign acquisitions in strategic sectors like infrastructure and security. Foreign groups seeking to acquire more than 10 percent of a priority strategic Spanish company must now seek approval from Madrid. Despite this, the Spanish government maintains its openness to foreign investment, particularly in sectors critical to its international competitiveness.
