Uchenna Izundu
International Editor
LONDON, Mar. 11 -- Oman Oil Co. SAOC has agreed to transfer an undisclosed stake in some of its international assets to Hungary's MOL Rt. under a strategic cooperation agreement signed Mar. 10. No details were given on the location of the assets
Oman Oil also will purchase an 8% stake in MOL, paying $145/share.
The parties have yet to finalize details on how much cash Oman Oil will pay and what assets it will give to MOL: these will depend on the necessary consents and other partners waiving their preemption rights. In the future, Oman Oil and MOL will evaluate other business opportunities.
Zsolt Hernadi, chairman and chief executive of MOL said: "This strategic cooperation will provide MOL significant growth potential in upstream and downstream businesses in the Middle East, Central Asia, and in other regions."
Oman Oil said the agreement would help it diversify its portfolio by moving into Central and Eastern Europe. The deal is expected to close by yearend.
Analysts have interpreted the deal as MOL's defending itself against a takeover proposed by OMV AG, which has stressed that a merger would bring synergies in Central and Eastern Europe (OGJ Online, Dec. 10, 2007). OMV, which has a 20.2% stake in MOL, said it is still committed to buying MOL and that Oman Oil would pay a lower price than OMV had offered for MOL's stock. It criticized MOL for not being transparent with the terms of the deal with Oman Oil.
Last week the European Commission launched an investigation into the competition implications of the proposed merger. It will evaluate how it might affect customers in the Central and Eastern Europe refined products market. According to the EC, a single supplier rather than two could seriously impact the markets.
The EC will make a decision on the takeover by Jul. 22.
Contact Uchenna Izundu at [email protected].
