Mol Raises Stakes in Croatia Talks by Preparing INA Sale

Mol Nyrt., Hungary’s largest refiner, said it will prepare the sale of its INA Industrija Nafte d.d. unit after talks stalled with the Croatian government over management rights in the company.

Mol’s board of directors authorized management to “start the preparations for the sale of Mol’s stake in INA,” the Budapest-based company said in a statement to the Budapest bourse today. It also authorized it to conclude an agreement with Croatia “that can lead to value creation through the execution of INA’s growth strategy.”

Mol’s Chief Executive Officer Zsolt Hernadi is wanted by Interpol and sheltered by his home country after Croatia issued an arrest warrant as part of a bribery probe into the deal that gave Mol INA’s management rights in 2009. Mol denied any wrongdoing and said Oct. 3 that it would reconsider the “nature” of its involvement in INA.

“It is clear that the frame for negotiations has changed,” the Croatian government said in an e-mailed statement after Mol’s comment. The government will do “everything it can to preserve INA as a regional energy leader, and to safeguard the interests of the company, its employees and the country’s energy security,” Croatia’s Economy Ministry said separately in an e-mail.

Mol’s shares declined 0.3 percent at the close in Budapest, extending this year’s slump to more than 17 percent. INA gained 1 percent to pare its drop this year to 1 percent.

There are still “significant differences” between the negotiating parties, Mol’s chief negotiator Jozsef Molnar told reporters in Zagreb today after the latest round of talks. Croatia suggests a “new model” of corporate management for INA, Croatia’s Economy Minister Ivan Vrdoljak said after the talks.

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