Croatian PM Proposes Talks with MOL on Sale/Share Swap in INA to be Delayed Indefinitely

MOL holds a 47.15% stake in INA and the Croatian government owns around 44%. Under the Croatian legislation, the state will keep a stake of 25% in INA until the country joins the European Union, which the government expects to happen around 2011.

During Friday's government session Sanader said he proposes that the sale or swap of state-held shares in INA is postponed indefinitely in view of the current energy situation, the global financial crisis and government efforts to secure Croatia's energy independence. He also proposed that INA's gas operations should be separated from its other business first, without elaborating.

In negotiations with MOL Croatia will also insist on an additional five years during which MOL will have to consult Croatia about any decision regarding  INA’s shares, the right to pre-emption if MOL decides to sell INA shares, and the right to repurchase INA shares in case of a MOL takeover, Deputy Prime Minister Damir Polancec said at Friday’s government session.

He added that Croatia and MOL should first agree on these issues, and only then a decision will be taken on the possible sale or swap of the state-held shares in INA.

INA explores and drills for oil and gas in Croatia, Angola, Egypt, Syria and Iran. It owns two refineries in Croatia and runs the biggest domestic fuel retail chain.

INA's shares, a component of the 28 -share Crobex index of the Zagreb bourse, closed  at 2,000 kuna on Friday, down from their Thursday close of 2,018.98.

(1 euro = 7.1655 Croatian kuna)