Links tighten between Orbán’s brother and a businessman who keeps winning public tenders

There have already been clear signs that one of Viktor Orbán’s brothers, Győző Orbán Jr., has been in close contact with an entrepreneur whose IT company group keeps winning public tenders. As Direkt36 had previously revealed, the relationship between the prime minister’s brother and Gábor Szentgyörgyi is linked to wrestling. Last year, they also watched a football match together, a few steps away from Viktor Orbán.

Gábor Szentgyörgyi, second from the right. Photo: Tamas Botos/444

Since then, their relationship has become even tighter. This spring, one of the business interests of Szentgyörgy registered a branch on a property belonging to the Orbán family. In this company, one of the business partners of Szentgyörgyi is Viktor Kovács, the son-in-law of Győző Orban Jr. In addition, Kovács also started to work as an employee at the IT company group of Szentgyörgy.

Szentgyörgyi’s business group has produced a spectacular growth in recent years. The group’s best performing company is IMG Solution Kft., whose revenues grew from only 46 million HUF (137 thousand EUR) in 2012 to 9.5 billion HUF (18.4 million EUR) last year, even though it did not even have a functioning website until recently.

The company managed to accomplish this result after winning a series of lucrative state tenders. Direkt36 has obtained previously unpublished public procurement data, which show that IMG Solution has been outstanding among other companies that participated in major IT and office technology tenders.

Meanwhile, the business empire of Szentgyörgy has expanded to include more companies, and his business interests participate in several large public procurement programs that are currently under way. For example, IMG Solution is part of ten major framework agreements that last for years.

Direkt36 contacted every player in this story but none of them responded to our questions.

The link in Hahót

The industrial site of Hahót Tőzeg Kft. can only be approached on a dirt road, on the outskirts of Hahót, a small village in Zala county. It extracts peat, which is mainly used for heating. The company is part of the business group of the Orbán family, owned by the prime minister’s 75-year-old mother and one of his brothers, Győző Orbán Jr.

According to company records and land registry data, this company also owns the land where its factory located. This April, however, another company also registered a branch on the same property: it is Graneos Gépgyártó Kft. Its headquarters is in a town called Veszprém, 100 kilometers away from its branch in Hahót. (Companies usually set up a branch if they carry out business activities at a location farther away from their headquarters.)

Although it is unclear what activities Graneos carries out in Hahót its appearance on the location is remarkable, as Graneos is indirectly owned by Gábor Szentgyörgyi, whose business interests have won a number of high-value public tenders in recent years.

It has already been revealed that Szentgyörgyi and Győző Orbán Jr. know each other. However, until now it seemed that their relationship is only linked to wrestling: as Direkt36 exposed earlier, the two men both wrestled, and they both participated in the work of a wrestling association.

However, the plant in Hahót is the first link that is connected to their business activities. In order to operate the branch in Hahót, Graneos had to obtain a permit from the Orbán-company. According to company records, the director of Hahót Tőzeg Kft. has agreed to allow Graneos to operate its branch on the property for free.

The marriage

Judging from its name, Graneos manufactures machines. It has been operating for just over two years and has not generated any revenue so far. The company, however, points to another, personal relationship between Győző Orbán Jr. and Gábor Szentgyörgyi. One of the owners of Graneos is the energy company Energép Kft., which is owned by three individuals. The majority owner is Szentgyörgyi, while one of the two minority owners is the 27-year-old Viktor László Kovács.

Kovács is tightly connected to the Orbán family: he is the son-in-law of Győző Orbán Jr. According to Facebook photos, he married the daughter of Győrő Orbán Jr. in 2015. Viktor Orbán also attended their wedding.

Kovács, a former professional ice hockey player, is not only a business partner of Gábor Szentgyörgyi. According to a source familiar with Szentgyörgyi’s businesses, Győző Orbán’s son-in-law joined Szentgyörgyi’s group as an employee. The source said that Kovács started working there in early 2018, seemingly without any experience in the field. “He had to be taught, he knew very little. He was not competent at all in IT and office technology,” the source explained, adding that, at the beginning, his colleagues tried to be discreet about Kovács’ attachment to the Orbán family, but that didn’t last long. “As he [Kovács] added half the company on Facebook a day after he started working there, it quickly became public. On Facebook, it could clearly be seen who his wife was,” the source explained.

When we contacted Szentgyörgyi’s companies we were told that one of the firms, Green Office Solution, has an employee named Viktor Kovács. In July the employee who answered the phone informed us that Kovács was on vacation – this was also shown on his public pictures uploaded to Facebook. We have tried to contact him several times since then through the company and through his personal email and phone number, but he has not responded. Szentgyörgyi and his companies have not answered our questions either.

The rise

Among the companies of Szentgyörgyi, IMG Solution Kft. is the most significant. It has been successful in several large public procurements in recent years.

In general, it is decided in several rounds which companies can provide IT and office technology products to government agencies and other state institutions. First, the Procurement and Supply Directorate selects companies, often dozens of them, through a procurement. The directorate signs a framework contract with the selected companies. Then the individual state agencies can order products, like laptops or photocopy machines, exclusively from these companies. For example, if the National Tax Authority wants to buy new computers, it has to solicit offers from the companies in the framework contract and will choose one of them.

IMG Solution got its first framework contract in September 2013. It was a 44-billion-forint (142.8-million-euro) framework contract for “computer systems and related services.” The company has become a participant of several similar framework contracts since then.

There is no publicly available data on the actual orders these companies are receiving in the framework contracts. The Procurement and Supply Directorate first told Direkt36 that it was willing to release this data in return of a fee of more than half a million HUF (1,5 thousand EUR). After we took them to court with the legal assistance of the Hungarian Civil Liberties Union, they agreed to release for free most of the data we had requested.

The data showed that IMG Solution was one of the most successful players in the thirteen framework agreements in which it participated between 2013 and 2018. The company received orders worth 6.2 billion HUF, making it the eighth best performing company among the 169 companies participating in the framework agreements. IMG Solution has been a supplier to many universities, government offices and hospitals.

With these contracts under its belt, IMG Solution has skyrocketed. While in the first years of its operation the company made only a few tens of millions HUF, in 2013 its revenue was 166 million HUF (539 thousand EUR), which jumped to 4.7 billion HUF (15.2 million EUR) in 2015. Last year, the company generated a 9.5-billion-HUF turnover, out of which after-tax profit was more than 1.3 billion HUF.

Other firms of Szentgyörgyi have also been successful in public procurements, even if they have produced far more modest results.

However, last autumn, the company group expanded further with VRS Magyarország Kft., which has also been a successful player in IT procurement for many years. According the procurement data, it received orders worth 7 billion HUF from the National Tax Authority. IMG was also a supplier to the tax office, where for a while a man with personal ties to both Szentgyörgyi and Győző Orbán Jr. was the leader of the department in charge of major procurements. The position of the manager was terminated after Direkt36 exposed this relationship in a story earlier this year.

For Hungarian company data, we used the services of Opten.

  • András Pethő

    András is a co-founder, editor and executive director of Direkt36. Previously, he was a senior editor for leading Hungarian news site Origo before it had been transformed into the government’s propaganda outlet. He also worked for the BBC World Service in London and was a reporter at the investigative unit of The Washington Post. He has contributed to several international reporting projects, including The Panama Papers. He twice won the Soma Prize, the prestigious annual award dedicated to investigative journalism in Hungary. He was a World Press Institute fellow in 2008, a Humphrey fellow at the University of Maryland in 2012/13, and a Nieman fellow at Harvard University in 2019/20. András has taught journalism courses at Hungarian universities.

  • Blanka Zöldi