Further Statement by Mabofi: Acquisition of Emfesz Power by Rosgas is Illegal

We refer to the recent media statements that Rosgas has acquired Emfesz Power, a subsidiary of Emfesz, and that the Swiss Interim Measures which make such an acquisition illegal have been removed.

Mabofi wishes to state and confirm that the Swiss Interim Measures are in fact still in place and that they will remain in place pending the outcome of Mabofi's appeals in Switzerland. This transaction, for an undisclosed sum, is therefore illegal and breaches the Interim Measures in force in Switzerland and Mabofi has applied to the courts accordingly. The purported acquisition of Emfesz Power is also contrary to Hungarian law.

Following the decision of the Budapest Municipal Court of Appeal on the 5 May 2010, confirming that the approval by the Hungarian Energy Authority (MEH) of the fraudulent transfer of Emfesz to Rosgas was unlawful, Rosgas is no longer authorised by the MEH as owner of Emfesz. Mabofi therefore wrote to Emfesz and to the Court of Registration informing them that, based on s 95 (3) of the Electricity Act, Rosgas is no longer allowed to exercise its purported rights as a shareholder of Emfesz, and that Emfesz shall not accept any further shareholder resolutions or instructions from Rosgas. The purchase of Emfesz Power would clearly involve a shareholder resolution.

In addition, at the request of the Hungarian National Investigation Bureau (NNI) a seizure was put in place on Emfesz’s shares in November 2009. This followed the raid of Emfesz’s offices by the NNI and the arrest of Emfesz Managing Director, Mr Goczi, on suspicion of embezzlement.

These measures were put in place specifically to protect Emfesz and its assets from any attempts to undermine the value of Emfesz prior to its return to Mabofi. However, the so-called “acquisition” of Emfesz Power by Rosgas is a blatant attempt by Mr Goczi and his associates to illegally strip the value out of Emfesz. According to the advice of Mabofi's lawyers, any transactions undertaken with or by Emfesz since the theft of the company are not only illegal, but could in fact also constitute criminal money laundering.

It is therefore a matter of serious concern and disappointment that, after more than one year since Emfesz was stolen from Mabofi, the Hungarian courts have still not even made a decision as to Jurisdiction and that the Police investigation into the fraud is still not concluded. In the meantime, Mr Goczi and the undisclosed owners of Rosgas continue to steal and fraudulently strip many millions of dollars out of Emfesz.

Meanwhile, Mabofi is continuing with all necessary and appropriate legal actions in Switzerland and Hungary against Rosgas, Goczi and all other persons and entities involved in the fraudulent transfer of Emfesz in order to recover its ownership of Emfesz and to secure damages that have resulted from this fraud. David Brown, Managing Director of Mabofi Holdings said: "Whilst the various investigations into this fraud proceed, and as the net tightens around Mr Goczi, we are taking every step necessary to prevent Mr Goczi or any of his associates from taking any further steps to try to transfer or otherwise undermine the ownership rights in Emfesz before Emfesz is finally restored to Mabofi Holdings."