MOL Wants Change in Croatia Before Taking Bigger INA Stake

 

MOL and INA have locked horns for years about control of the Croatian oil company, in which MOL owns 49 percent. MOL also has certain management controls at INA under an agreement with the Croatian state, which holds 45 percent.

 

"We cannot talk about MOL buying the Croatian oil company's state-owned stake, in part or in whole, before the Croatian government creates an investor-friendly environment and strives for co-operation with foreign companies investing in the country, as well as INA," MOL CEO Zsolt Hernadi told Hungary's state news agency MTI.

 

The two groups have been unable to settle their disagreements over control of INA. Zagreb wants more influence in decision-making at INA, while MOL wants to keep its management rights and has said it is ready to sell its stake in INA if no agreement is reached.

 

Talks between Zagreb and MOL, which began in 2013, have not resolved the situation. Economy Minister Ivan Vrdoljak in May flagged a potential new shareholder agreement but nothing has been put forward since.

 

Hernadi also said there had been several suitors for MOL's INA stake as recently as the spring of 2015, but he said there had been "no steps forward that could be communicated."

 

He reiterated that MOL had a strategy that outlined a future without INA but he also said it would be in the long-term interest of MOL, as well as the energy security of Central and Eastern Europe, to keep INA within MOL group.

 

He did not elaborate.

 

When asked if Hernadi's comments meant MOL had considered increasing its INA and how this might be achieved, MOL's communications department declined to comment.

 

The Croatian government declined comment.

 

Croatia's political parties have been trying to form a government since elections last week, with the incumbent Social Democrats and the former ruling Croatian Democratic Union (HDZ) both short of an outright majority.

 

HDZ took 59 seats in the 151-seat parliament, the leftists 56 seats, leaving as kingmakers the three-year-old Most (Croat for bridge) party, which holds 19 seats.

 

During the election campaign, a corruption case involving MOL and INA entered a new phase. Croatia's Supreme Court ordered the retrial of former HDZ Prime Minister Ivo Sanader, annulling his 2014 conviction for taking a 10 million euro bribe from MOL.

 

Croatia's interior minister, meanwhile, complained that Hernadi, who is wanted by the Croatian authorities and subject of an international arrest warrant, has been granted an exception and travelled freely to Germany and Austria.

 

Hernadi, Sanader and MOL all deny any wrongdoing, and Hernadi has been cleared of any wrongdoing by Hungarian courts.