December 27 (SeeNews) - Croatia will regain ownership of oil and gas company INA by buying back the whole stake held by Hungarian energy group MOL, the country's prime minister said over the weekend.
INA-Industrija Nafte d.d., the biggest Croatian energy company, is owned by Hungarian oil company MOL with a 49.08% stake and the Croatian government with 44.84%, as institutional and private investors hold 6.08%.
"The Hungarian side has been notified of this decision", Andrej Plenkovic is quoted as saying in a statement released by the government on Christmas eve.
The decision to regain ownership in INA comes after it emerged that MOL has won one of the two arbitration proceedings Croatia launched against the company before the arbitral tribunal of the United Nations Commission on International Trade Law (UNCITRAL).
In 2014 the country's government filed for international arbitration against MOL with the aim to cancel a 2009 deal that allowed MOL to take over INA's management. Last year, Croatia ordered a retrial of former prime minister Ivo Sanader who was earlier convicted for taking a bribe from MOL to allow it to acquire a dominant stake INA.
"The arbitral tribunal has ruled that the evidence is not sufficient to prove that the agreements signed in 2009 are the result of corrupt activities and it has refused to nullify them," Plenkovic explained.
"The government is strongly opposed to the tribunal's ruling and we are considering all legal options to contest it" he added.
INA is a company of strategic importance for Croatia, Plenkovic noted.
"Croatia will initiate a buyout of MOL's entire stake in INA under a model we have already worked out, which is financially sustainable and which won't increase Croatia's public debt. Given the sensitivity of the market, we will discuss the details of this model when the conditions have been met", Plenkovic added.
The International Centre for Settlement of Investment Disputes in Washington is expected to rule on the matter next year.