February 12, 2019 / 10:00 AM / 5 months ago

Hungary to transfer MOL and Richter stakes to university

BUDAPEST, Feb 12 (Reuters) - Hungary’s government will bestow state stakes in two blue-chip companies worth a total of 380 billion forints ($1.34 billion), on the Corvinus economic university in Budapest, daily paper Magyar Hirlap reported on Tuesday.

The stakes, 10 percent each in oil and gas group MOL and drugmaker Richter, will be transferred to the Maecenas Universitatis Corvini foundation, which will be barred from selling or short-selling the stock.

Richter shares were up 0.5 percent higher at 5,575 forints by 0936 GMT, while MOL shares was flat at 3,156 forints. The Hungarian blue-chip index gained 0.5 percent.

Corvinus is a public university that, like most other colleges, is allocated an annual budget by the state, but that will funding will now be replaced by dividend revenue from the Richter and MOL holdings.

Hungary’s government has held a 25 percent stake in Richter and MOL. The 10 percent stakes to be transferred to the university had a combined 2018 dividend value of about 10 billion forints, Innovation Minister Laszlo Palkovics told news website Portfolio.hu.

The new strategy will be used to transform funding of several other higher education institutions in a similar way, Magyar Hirlap reported without naming its sources.

Richter spokeswoman Zsuzsa Beke told Portfolio.hu that the company considered the move a positive stakeholder action and an innovative initiative.

An MOL spokesman was not immediately available for comment.

Erste Bank analysts said in a note to clients on Tuesday that the transaction, because the stakes are barred from being traded, reduces the likelihood of a third-party takeover and has no impact on the share price. (Reporting by Marton Dunai Editing by David Goodman)

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