OMV will not wait for many years to acquire Hungary's MOL but it can certainly hold on for a few years for the deal, OMV CEO Wolfgang Ruttenstorfer told Portfolio.hu on Wednesday. He believes MOL has excellent management that would be consulted if combining of the two companies were to be realised. With respect to "lex MOL", a newly passed law that is aimed at defending strategic Hungarian companies from unwanted foreign takeovers, Ruttenstorfer noted such nationalist way of thinking is unwise. Portfolio.hu: What do you think about lex MOL? 
Wolfgang Ruttenstorfer: My personal view is that we should not think in a nationalistic way, but rather talk about how to create a strong Central and Eastern European oil and gas company that will be able to compete with both Western and Russian oil companies. Probing lex MOL is not our task but of the European Union. We won't say what we think about it because that is not our job.
2007.10.09 09:28
Hungary Parliament nods in concert on lex MOL "We don't know yet what [our] next step will be. The ball is now in the court of Brussels," Ruttentstorfer told in a separate interview with news portal index.hu.
2007.10.09 14:22
EU is already looking into new Hungarian law against hostile takovers Portfolio.hu: OMV claims a synergy estimate of EUR 400 million per annum from a combination of the two companies. Which areas will this come from W. R.: Firstly, we see great savings potential in downstream and logistics, since both of us have similar storage capacities on the same spots and merging our operations would lead to a smaller human resource demand. Oil purchases and production could also be optimised. Secondly, we also see great synergy potential in petrochemicals, given that MOL foes not have the critical size at Slovnaft's petchem division. Thirdly, both companies are pursuing upstream operations in a number of countries, e.g. Pakistan, Yemen, Egypt, Kazakhstan, Russia, while in respect of gas supply the whole of South Eastern Europe could be linked via Hungary.
Portfolio.hu: What changes would OMV implement in MOL's strategy if the merger was realised? W. R.: We want to decide together with MOL's management how to work together, with no intention to tell them what we would do differently. MOL's management have showed an excellent performance over the past years, without a doubt. That's why bought a stake in MOL. It is not our style to tell anyone what to do. Let's sit down and work it out together.
Portfolio.hu: You've mentioned Slovnaft's petchem division. Don't you think that it reaches economy of scale with TVK? W. R.: TVK yes, but Slovnaft no. And neither of these are significant players in themselves, compared to the major petchem companies. I do believe, however, that TVK is a highly competitive firm.
Portfolio.hu: Let's presume for a second that you succeed in combining OMV and MOL. Will you want to increase further stakes in Croatia's INA? W. R.: I wouldn't want to tell MOL's management what to do [with INA]. We'd like to have a joint decision on this, as well.
Portfolio.hu: Should you fail to join OMV and MOL, what areas do you think would be left for co-operation? W. R.: Over the past years we wanted to establish co-operation with MOL in several areas, such as petrochemicals, gas and upstream. To concrete deal has been sealed up to date. That's why we started to prefer a merger.
Portfolio.hu: What would be OMV's next move if the merger turned out to be absolutely impossible? Will OMV sell its MOL stake or wait? W. R.: We can wait - for years if necessary. We believe a merger would make sense, and if it is reasonable now it can be so a few years from now, too. Since we acquired our MOL stake at a relatively low price, we have time, there's no pressure on us in this respect.
Portfolio.hu: Could you wait many years if necessary? W. R.: No, not many years, but several years.
Portfolio.hu: Petrochemical margins have risen substantially this year. What prospects do you envisage for this segment? W. R.: Quite considerable capacities will enter the market in 2009-2010 in the Middle East, so we believe we are currently on the top of the cycle.
Portfolio.hu: Let's talk about Petrom! How do you plan to achieve the OPEX (operating expenditures) target set out in your strategy for 2010, considering that there has been a continuous rise in this area over the past years? W. R.: The painful rise of production costs was brought about 50-50% by the strengthening of the lei and the cost inflation in the oil sector. Our target of USD 9/barrel will be extremely hard to achieve. It is possible that we will be unable to offset the impact of the lei's firming, but we still expect a major decline by 2010.
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