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. Last Updated: 07/27/2016

MOL Shareholders Pass Measures to Block Surgut

BUDAPEST -- Investors in Hungarian oil and gas group MOL approved measures on Thursday to make hostile takeovers more difficult, but the company's biggest shareholder Surgutneftegaz could not vote.

Shareholders overwhelmingly supported the measures, which the firm said were needed to prevent any "creeping takeover at the time when the firm's shareholder structure was shifting."

Surgut bought a 21 percent stake in MOL from Austria's OMV for 1.4 billion euros ($1.8 billion) in a surprise move earlier this month, earning the ire of MOL and Hungary's government.

Company and government officials said it was unacceptable for an investor to take a significant stake in MOL, a firm deemed by the state to be of "strategic importance," without cooperating with MOL and the government.

Surgut could not vote at Thursday's meeting because it lacked the regulatory approval necessary to be registered as a shareholder, but the firm said its intentions were friendly.

"We have indicated several times that we are ready for open, constructive dialogue with MOL's management, and we have requested a chance to make our view and intentions clear in a meeting," Surgut said in an advertisement.

Analysts said motions to change company statutes would have passed even if Surgut voted, as investors considered friendly to MOL's board and management are estimated to hold about half of all shares.

"With the ... amendments to MOL's Article of Association at today's meeting, the chances of Surgut (or any other company behind it) taking over MOL are practically zero," KBC oil sector analyst Peter Tordai said in a note.

Thursday's meeting approved a company statute that requires shareholders, if requested, to declare who the "ultimate beneficial owner" of their shares is and allows the company to prevent a shareholder from voting if it deems this declaration to be deceiving.

Shareholders also voted to require a 75 percent majority to remove board members and required the approval of the government's special veto-right share for electing and removing board members in case the board itself does not support the proposed change.

The new rules allow for the removal of just one board member per shareholder meeting and stipulate that only one board member may be removed every three months.