euro adhoc: OMV Aktiengesellschaft / other / OMV revokes declaration of intent to combine OMV and MOL

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OMV/oil/gas/energy

06.08.2008

- OMV revokes its intention published on September 25, 2007 to make
an offer to shareholders of MOL of HUF 32,000 per share - The
European Commission has indicated that it would not accept
commitments that OMV had proposed; since other commitments would be
unacceptable to OMV, OMV has decided to withdraw the merger
notification filed with the European Commission on January 31, 2008 -
Further pursuit of proposed combination with MOL under given
conditions would be against OMV´s economic and strategic rationale -
OMV continues its successful growth strategy in Central Europe

On September 25, 2007, OMV publicly announced that it would be in a
position to make an offer to shareholders of MOL of HUF 32,000 per
share once certain impediments to achieve voting control over MOL
would have been removed. Today, OMV revokes its intention to make an
offer to shareholders of MOL. Accordingly, OMV has decided to
withdraw the merger notification filed with the European Commission
on January 31, 2008. On June 16, 2008, the European Commission issued
a Statement of Objections, outlining its concerns regarding OMV´s
potential combination with MOL. OMV does not share these concerns and
has submitted its observations on the Statement of Objections.
Nonetheless, OMV proposed commitments that OMV would have been
willing to offer. The European Commission has, however, indicated
that these commitments would not be acceptable. OMV is not prepared
to offer more far-reaching commitments without jeopardizing the
economic and strategic rationale for the transaction. Therefore, the
Board of OMV has decided today to revoke OMV´s intention published on
September 25, 2007 to make an offer to shareholders of MOL of HUF
32,000 per share and to withdraw the merger notification that OMV had
filed with the European Commission on January 31, 2008. "In addition
to the sale of retail stations in various countries, OMV had proposed
a `shared-refinery´/cost center model to address the Commission´s
principal concerns regarding the concentration of refining capacity
across the region," said Gerhard Roiss, OMV´s Deputy Chairman and
responsible for Refining and Marketing. "OMV proposed the creation of
a refinery centre, in which an independent third party could have
held a capacity share with a share in corporate governance equal to
OMV." The proposal included the integration of the Schwechat and
Slovnaft refineries, which are only 55 km apart from each other,
creating one refinery complex. Such a commitment would have allowed
the independent buyer access to significant refining capacity and
products, crude transport facilities, storage infrastructure, the
ability to sell product at highly competitive terms and, therefore,
to become a strong competitor throughout the region. This is an
existing business model elsewhere in Europe. For example, OMV already
shares refining capacity along with BP, ENI and Ruhroil at the
Bayernoil refinery network. "The EU has stated the need for a common
European energy policy and to support a policy of creating stronger
European energy companies to ensure the security of supply for the
region - fundamental objectives for our proposed combination with
MOL," said Wolfgang Ruttenstorfer, Chief Executive of OMV. "We
strongly believe in our original rationale for a strategic alliance
with MOL. The combination of both companies would have significantly
enhanced the security of energy supply throughout the region through
both greater diversification of crude oil supply, as well as the
greater scale in upstream to generate additional growth of the
combined resource base," stated Wolfgang Ruttenstorfer. An immediate
benefit of the combination with MOL would have been the creation of a
more efficient downstream business. OMV believes that increased
efficiency, together with optimizations both at corporate level and
in the upstream, gas and petrochemical divisions, would have helped
the combined group to deliver total pre-tax synergies of
approximately EUR 400 mn per annum. "OMV has a core principle to only
follow and implement value accretive deals. We pursued our goal as
long as there was a reasonable chance that such a transaction would
meet our disciplined criteria for value generation. Given the
indication from the European Commission that it would not accept our
remedy proposal, OMV´s board has concluded that such a merger would
not fulfil our standards." Ruttenstorfer added. OMV continues to
believe strongly that consolidation in the Central European oil and
gas industry will continue. OMV is now considering various options to
maximize the value of its 20.2% stake in MOL and to benefit from
value creation in the consolidation process. As an active shareholder
in MOL, OMV will continue to seek ways that ensure the best
principles of corporate governance are applied. Therefore, the law
suits regarding MOL´s corporate governance will be continued. OMV´s
desire to achieve a combination with MOL has always been independent
from its strategy for the growth of the existing businesses - as an
integrated oil and gas company. OMV´s business remains firmly on
track to deliver the targets that have been set through to 2010. OMV
remains focused on delivering its strategy and continuing to play an
active role in the growth region of Central Europe. In addition,
OMV´s diversified geographic portfolio of upstream assets continues
to provide OMV with real strength, with new developments in New
Zealand, Kazakhstan, Austria and Yemen in the second half 2008.

end of announcement euro adhoc
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ots Originaltext: OMV Aktiengesellschaft
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Further inquiry note:

OMV

Investor Relations:

Ana-Barbara Kuncic

Tel. +43 1 40 440-21443; e-mail: investor.relations@omv.com

Press:

Bettina Gneisz-Al-Ani

Tel. +43 1 40 440-21660; e-mail: bettina.gneisz@omv.com

Thomas Huemer

Tel. +43 1 40 440-21660; e-mail: thomas.huemer@omv.com

Internet Homepage: http://www.omv.com

Branche: Oil & Gas - Downstream activities
ISIN: AT0000743059
WKN: 874341
Index: ATX Prime, ATX
Börsen: Wiener Börse AG / official dealing