Mabofi Expresses Concerns Over Role Of Hungarian Authorities In The Fraudelent Transfer Of Its 100% Shareholding In Emfesz To Rosgas
Further to our Press Statement of 07 May 2009 regarding the fraudulent transfer of Mabofi’s 100% shareholding in Emfesz (Hungary’s largest independent gas trader) to Rosgas AG in Switzerland, Mabofi has investigated the circumstances behind the illegal transfer.
Role of the Hungarian Energy Office (MEH)
On 29 April 2009, Rosgas, a company registered in Switzerland and with no disclosed shareholders, informed the Hungarian Energy Office (MEH) that it had acquired 100% ownership in Emfesz. Rosgas requested formal approval by the MEH for the transfer. According to Hungarian law, the consent of MEH is required for the change of ownership of a Hungarian energy company.
On the same day (i.e. 29 April 2009) MEH gave its consent to the transfer. This consent was given without the production to MEH of any documentation from any authorised representatives of Mabofi or any agreement between Mabofi and Rosgas relating to the purported transfer (as no such agreements existed, which Mabofi is aware of). MEH acknowledged in its own resolution that it did not have any knowledge of the beneficial owners of Rosgas but was nevertheless content to give its consent. MEH granted Rosgas 45 days to disclose the beneficial owners.
MEH was also legally obliged to request that RosGas should submit its audited financial statements, but RosGas was only established in December 2008 in Zug – at that time under the name Ikron AG.
It is therefore surprising that the fraudulent transfer of Hungary’s largest independent gas trader with a 20% share of the domestic market was approved without seeing or requesting the necessary documentation that it was legally obliged to have before giving such approval, and without any information regarding the ownership and financial status of the acquiring company.
To reiterate, none of the rightful representatives of Mabofi were contacted, they had not concluded any agreement with Rosgas AG, and had no prior knowledge of the share transfer or of the application to MEH.
On 6 May 2009, the day when the Court of Registry registered Rosgas as the new owner of Emfesz, David Brown, the director of Mabofi Holdings, formally informed the President of the MEH, Ferenc J. Horváth, of the above in writing and also met with Mr Horvath, requesting the immediate withdrawal of MEH’s consent to the acquisition of Emfesz by Rosgas. Mr Horvath stated that he would raise the issues with the lawyers who submitted the application for approval at the MEH. To date, Mabofi has had no response.
In complete contrast to the speed with which MEH gave its same day approval of the transfer, we are informed that Mabofi’s petition has not yet even been assigned to a responsible person at MEH.
Role of the Court of Registry
Rosgas’s request to register itself as the new owner of Emfesz arrived at the Court of Registry on 4 May 2009 at 8.48am and on the same day at 11.39am, Rosgas was registered as the new shareholder of Emfesz. This was done without any further investigations about the sale and purchase agreement or confirmation whether any agreement had been signed by an authorised officer of Mabofi. Emfesz’s former General Manager, István Góczi, who, according to the documents submitted to the Court of Registry, acted as Mabofi’s General Manager (a title he never held) purported to sell Emfesz to Rosgas, represented by his own deputy, Dr Tamás Gazda, an employee of Emfesz and also a director of Rosgas, who signed the sale and purchase agreement on behalf of Rosgas.
Mr Goczi fraudulently purported to sell an asset without authorisation and without informing the legal owner of the transaction’s existence. This was approved by the Court of Registry in less than three hours.
On 6 May 2009, the responsible judge at the Court of Registry was notified of this illegal action. To this date, no response has been received from the Court of Registry.
The fact that the Hungarian authorities were able to approve the transfer of an important and strategic energy company in a matter of a few hours, without appropriate documentation, without the consent of its founding and legal shareholder, and without ascertaining the ownership of the acquiring company, undermines not only the rule of law and investor confidence in Hungary, but it is also undermines the country’s energy security.
Mabofi is launching legal actions to reinstate its ownership and to press criminal charges as appropriate.
NOTE: Mabofi has been the owner of Emfesz for four-and-a-half years, a period during which it has invested heavily in the development of Emfesz, a company that has become a reliable and reputable market player in the Hungarian energy sector. During these four-and-a-half years, neither the structure of the shareholder nor the legal representatives of the company have been revised. Mabofi can also confirm that no funds have been received by it in relation to this purported transfer to Rosgas.
The registered equity of the company was 552 million HUF (US$2.6m / €1.91m) and its profits after tax were 3,374 million HUF in 2007 (US$15.85m / €11.70m).
David Brown
Director
Mabofi Holdings Limited