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Croatian market authority accuses MOL of market manipulation in INA public-purchase offer

Croatia's financial-market authority HANFA said on its website on Wednesday that Hungarian oil and gas company MOL manipulated the market in connection with its December 2010 public-purchase offer for 8% of the shares of Croatian peer INA.

HANFA said that MOL's free-float offer for 8% of INA shares at HRK 2,800 per share, the same as the price in a public purchase offer the company made in the autumn of 2008, and subsequent information disseminated through the media represented "false and misleading" signals aimed at acquiring a majority stake in INA.

MOL currently owns 47.75% of INA while the Croatian government holds a 44.84% stake in the company.

HANFA cited as proof of its assertion that MOL had manipulated the market the 1.6% of INA's shares which are still in deposit accounts, the same amount as MOL asserts it has a share-purchase option for.

MOL informed HANFA on Tuesday that it bought 21,009 shares in INA in four transactions through brokers on the OTC market or on the Zagreb Stock Exchange and held 4,746,629 of a total of 10,000,000 INA shares on the accounts of custodians and sub-custodians. MOL also told HANFA that the company has an option to buy the 1.6% of INA shares. MOL provided the information in response to questions in a letter from HANFA dated May 9.

HANFA on Monday extended a suspension of trade in shares of oil and gas company INA for a second time until May 20, HANFA said on its website. HANFA originally suspended trade in INA shares from April 28 until May 6 to give it more time to identify foreign buyers of the shares. Near the end of the period, it extended the suspension for another week.

Other market players appeared to outbid MOL for INA shares following the public-purchase offer, pushing INA's share price over the offer. MOL raised its stake by just 0.1% in the offer.

MOL has firmly rejected speculation in the Croatian press that it was behind the purchases of INA shares under scrutiny by HANFA, but it has confirmed it bought INA shares from third parties after the purchase offer ended.