Hungary planning to strike fair deal on INA, says Orban

By bne IntelliNews November 29, 2017

Hungary is ready to strike a "fair deal to end the poisonous dispute" surrounding MOL and Croatian energy company INA, Hungarian PM Viktor Orban said after he met his Croatian counterpart Andrej Plenkovic on November 28 in Budapest.

MOL has been involved in a long-running dispute with the Croatian government over the running of Croatian energy company INA, in which MOL exercises management rights even though it only has 49% of the shares.

Croatia issued an arrest warrant for MOLʼs chairman and CEO Zsolt Hernadi on suspicion he paid bribed the countryʼs former Prime Minister Ivo Sanader to give MOL management rights in 2009. Hernadi was acquitted on charges of international bribery by a Hungarian court, which Zagreb did not accept.

Croatia has also sought to overturn the contract in international courts over the years, citing alleged breaches of shareholders agreement and corporate governance by MOL.

Orban said political relations between the two countries were "excellent", as was their historical relationship. "And we don't want to poison this relationship with an issue like the dispute surrounding MOL and INA," he added.

“The government regarded the case as a business rather than a government issue. At the same time, it supports a quick resolution, and if the Croatian government does not want MOL in Croatia in the future, then Hungary is ready to make a fair deal and return INA shares in its possession.”

Hungary blocking Croatia's bid for OECD membership in September was also linked to the ongoing dispute over the future of INA. Croatia has signalled its intention to buy the 49% stake INA but it lacks the necessary funding. It previously suggested it planned to privatise a 25% stake in state-owned power company Hrvatska Elektroprivreda (HEP) in order to finance the acquisition, but this did not gather enough support.

Andrej Plenkovic said the political will was there to end the dispute. "The two countries must also find the right model that is both fair to Hungarian investments that have already been made and values INA's shares at a realistic price", he added.

Russiaʼs state-owned oil and gas company Rosneft has been eyeing MOL's place as a stakeholder in INA but a possible Russian ownership of the Croatian company is likely to meet opposition from the EU and United States.

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Hungary planning to strike fair deal on INA, says Orban

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Hungary planning to strike fair deal on INA, says Orban

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