Austrian oil and gas player OMV has made a renewed offer for its Hungarian counterpart MOL of HUF32,000 in cash per MOL share with a partial share alternative, and has revealed that its interest in MOL has increased to 20.2%. However, MOL has continued to spurn OMV's advances, saying that the offer substantially undervalues its business.

OMV said that, at present, it is unable to achieve voting control in MOL due to a number of technical impediments, including the 10% voting restriction in MOL’s articles of association. OMV said that once the impediments are removed, its offer will be conditional solely on securing at least 50% voting control of MOL and securing EU anti-trust approval.

OMV said that it is therefore seeking to engage in active discussions with the independent shareholders, the European Commission and other stakeholders in MOL so that these impediments can be removed and MOL’s independent shareholders can decide on the merits of the offer. OMV said that, so far, MOL board has denied its shareholders this choice.

To start the process of removing the impediments, as well as announcing its declaration of intent, OMV has sent a letter to MOL’s board of directors inviting it to enter into a constructive dialogue, with the ultimate objective of realizing a combination that would enhance the strengths of both companies and benefit all stakeholders.

OMV outlined its commitment to Hungary and went on to say that it believes that improved efficiency in the upstream, downstream and petrochemical divisions would help the combined group deliver total pre-tax synergies of approximately E400 million a year.

However, MOL said that OMV’s estimation regarding the E400 million synergies ignores the loss of value arising from the disposals program that would be required by the anti-trust authorities, among other issues. It also said that the merger would be value destructive and in a press release on the matter, concluded: OMV’s move does not merit further consideration and MOL will not be entering into dialogue with OMV to discuss the approach.