Investment bank Goldman Sachs has joined the ranks of advisers helping Hungarian energy company MOL to fight off the attentions of Austrian suitor OMV, said people familiar with the matter.
The U.S.-based investment bank, known for it bid defense work, was hired partly because of its understanding of Brussels as the situation heads towards a possible showdown between Hungary and the EU, said the people on Friday.
Former EU commissioners Mario Monti and Karel van Miert both work as international advisers for the investment bank, which is joining UBS and Morgan Stanley in the MOL camp in providing strategic advice.
Last week, European Union Internal Market Commissioner Charlie McCreevy wrote to the Hungarian government threatening to extend action against the country if a new law prevented companies from other EU states buying into MOL.
On Monday, Hungary's parliament approved the law, which many investors say is designed to protect MOL from being taken over by OMV and which has been criticized by the European Union.
MOL and Goldman Sachs declined to comment.
OMV plans to offer 32,000 forints ($181) per MOL share if MOL removes a 10 percent voting right cap and if the 40 percent stake in MOL that its board and friendly institutions control is cancelled or neutralized.
MOL and the Hungarian government have resisted the offer and MOL's shares were trading at 27,800 forints -- substantially below the potential bid price -- at 1034 GMT on Friday, showing the market believes there is a strong chance OMV will fail in its attempt.
The Austrian company may call an extraordinary meeting of MOL shareholders to try to repeal MOL management's ability to use 40 percent of MOL shares to block any bid, a person familiar with the matter said earlier this week.
The Vienna-based company or other MOL investors could call such a meeting as early as next week.
MOL is allowed to own 10 percent of its own stock directly, but analysts estimate that over 40 percent of the stock is held directly and indirectly by MOL and allied institutions via a variety of stock lending schemes.
(Reuters)