S&P may lower MOL Hungarian Oil

Standard & Poor's said it placed the BBB- long-term corporate credit rating on MOL Hungarian Oil and Gas plc on CreditWatch with negative implications.

This reflects the company's plans to launch an offer for the 30% of INA shares that are not held by the Croatian government, while also negotiating acquiring a further INA stake from the government, according to the agency.

The watch reflects the potential for further debt increases, S&P said.

The rating reflects the company's leading position in the Central and Eastern European markets, strong downstream assets and some upstream asset diversification, together with higher-than-peers' and relatively resilient profitability from its core refining and marketing activities, S&P said.

MOL's aggressive share buybacks since mid-2007, increased leverage, exposure to the volatile and cyclical refining industry, and dependence on Russian crude imports, the agency noted.

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