Brussels, 06/08/2008 (Agence Europe) - Austrian oil and gas company OMV has abandoned its plans to buy up Hungary's oil and gas company MOL. Following interruption, negotiations started up again with the European Commission in June following the Commission's concerns that the buy-up would lead to excessive concentration of refining capacity in central Europe (see EUROPE 9673) and are still under way.
In a press release, OMV says that it is withdrawing its buy-up plans that led to an offer of 32,000 Hungarian forints a share on 25 September. A European Commission spokesperson, Ton van Lierop, said the deal would have combined the only two integrated gas and oil companies active in Austria, Hungary and Slovakia, along with three refineries, the only refineries in the three countries. Ton van Lierop added that in informal talks, OMV had not suggested any remedies to answer the European Commission's concerns, preferring to abandon its plans. The OMV says it had suggested selling a number of petrol stations and combining two refineries in a complex open to a third party. These measures were judged by Brussels to be insufficient. The spokesperson neither confirmed nor denied the idea that the European Commission had demanded that the merged entity sell one of its three refineries. As far as Hungary is concerned, OMV's offer was seen as hostile to national interests. Budapest has passed a 'MOL law' to protect 'strategic' companies. Infringements proceedings were launched against the MOL law in November 2007 by EU Internal Market Commissioner Charlie McCreevy, who saw it as unjustifiably restricting the free circulation of capital. (C.D. /transl fl)