Surgutneftegaz Is To Buy 21 percent of Hungarian MOL

Russian firm Surgutneftegaz is going to buy stake in Hungarian MOL The stake now belongs to Austrian energy firm OMV. It announced on Monday it would sell the stake for $1.9 billion in a deal worth 19,212 forints per MOL share, a 93 percent premium to Friday's close. Russian company believes the deal would advance its strategy of being vertically integrated. Surgut Chief Executive Vladimir Bogdanov hopes that the purchase of a stake in MOL is a serious basis for the start of long-term, mutually beneficial co-operation between our companies. But the Hungarian company plans to pursue an independent strategy, saying that it doesn' have any operational relationships with Surgutneftegaz. MOL has a number of defenses against a hostile bid, including a voting cap and a Hungarian law, dubbed 'Lex-Mol', which was criticized by the European Union when passed in 2007. However, a company seen as loyal to the Kremlin is considered a tougher opponent than OMV and one which is unlikely to rely on EU legal challenges to secure its aim. Surgut's acquisition of a stake in MOL, whose interests are concentrated in Hungary, Slovakia and Croatia, expands Russian influence in consumer countries hard hit by gas cuts in Russia's winter row with Ukraine over gas pricing. MOL, Hungary's biggest company by market capitalization, is co-operating with South Stream and is also a partner in a rival pipeline, Nabucco. MOL operates a large modern refinery in Hungary, the 165,000 barrels-per-day Szazhalombatta plant, as well as a 60,000 barrels-per-day plant at Bratislava in Slovakia.