The Slovak Antitrust Office (PMU) on Monday approved an increase in the share of Hungarian gas and oil company MOL in Slovak crude-oil refinery Slovnaft from 36.2 percent to 67.8 percent. The transaction has already been approved by antitrust offices in Hungary and the Czech Republic.

PMU started administrative proceedings on the merger of MOL and Slovnaft on December 2, 2002 and approved it on March 7, 2003, finding that the merger does not increase the dominant position on the relevant markets disabling effective competition, reads the PMU’s decree. PMU defined wholesale and retail in diesel and petrol as relevant markets .

In late November of last year, MOL and the companies Slovintegra and Slovbena signed a contract on acquisition of a package of 6,520,691 Slovnaft-shares representing 31.6 percent of the stake in Slovnaft for USD 360 million. After gaining majority, MOL will be obliged to announce a public takeover bid for the remaining Slovnaft shares. The price offered for the shares, according to the law, must not be lower that their average stock exchange price over the last six months before the takeover. At the same time it must be higher then 50 percent of the net commercial asset per one share according to the latest financial statement.

Last Friday, the Bratislava Stock Exchange (BCPB) suspended trading in shares of Slovakia’s largest crude oil refiner Slovnaft. The stock exchange was responding to information about some facts, which might have harmed investors or jeopardized public interest if BCPB had not suspended trading. „We were notified by market participants, and we are now investigating the transactions,“ said BCPB’s Olga Dlugopolska.

Last week BCPB posted active trading in Slovnaft shares and their price was soaring. On Thursday, the shares were traded at SKK 1,536 on average while they went for an average price of only SKK 1,194 at the beginning of the week. The closing price of Slovnaft shares increased by 280 to SKK 1,480 from Monday to Thursday.

Slovintegra, holding 28.7 percent in Slovnaft and Slovbena with 2.9 percent, sold their share to MOL for USD 85 million in cash and also acquired nearly a 10-percent share in MOL worth USD 275 million. The par value of the Slovnaft shares was set at SKK 2,200.

MOL signed the contract on the strategic investment in Slovnaft on March 31, 2000. PMU approved this transaction in September 2000 under the condition that the number of gas stations under joint control of Slovnaft and MOL could not increase until 2004. MOL had an option to take control of Slovnaft.

Other major shareholders in Slovnaft are financial groups J&T and Istrokapital (15 percent) and the European Bank for Reconstruction and Development (8.4 percent).