MOL, Hungary's leading integrated oil company, on Wednesday announced its expansion into a new European market through the acquisition of Italiana Energia e Servici (IES). IES is a privately owned oil refining and marketing company based in northeast Italy, with 600 employees.
This acquisition, which is subject to regulatory approval, will enable MOL to build a strong presence in northern Italy and represents an important step towards helping the group achieve its downstream growth targets for 2010. MOL also intends to transfer its best-in-class operating standards to improve the profitability of IES's refining and retailing activities.
Zsolt Hernadi, MOL's chairman and CEO, commented:
"The acquisition of IES represents an exciting opportunity to extend our geographic footprint into a new region and use our industry-leading expertise to add value to new assets. The move allows Mol to deliver growth both through acquisition and organic development and sustains our track record for value-creating expansion."
IES owns the Mantova refinery and has a chain of 165 retail stations, of which 30 are directly owned. The company's area of operations is adjacent to MOL's current key territories of Croatia, Austria and Slovenia. This provides MOL with opportunities both to expand its downstream presence in northeast Italy and adjacent markets and supply the Italian market from the Group's INA refinery in Rijeka, Croatia.
MOL intends to increase the capacity of IES's Mantova refinery by 15% from its current level of 2.6 mtpa to 3 mtpa through a EUR130m capital investment program. It also plans improvements in the refinery's efficiency levels and product mix.
"In a bid situation, some companies would only go for the best price, but we evaluated the whole package and favored the proposal that proved us best refining expertise in track record and convincing plans for growth and further development," stated Adolfo Vanucci, IES CEO.
IES reported Ebitda of EUR 98m on sales of EUR1.295bn for the year to the end of June, 2006.