Indium News

Norges Bank Investment Management may review its holding in Mol because of the fund’s ethics rules, the Hungarian business newspaper said, without citing anyone. Mol’s stock is down 7.8 percent since Croatia issued an arrest warrant against Chairman Zsolt Hernadi on Oct. 1 as part of a bribery probe into the 2009 deal that gave the refiner control of Zagreb-based INA Industrija Nafte DD. The fund won’t comment on specific investments, spokeswoman Marthe Skaar said by phone today.

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In studies of over 25,000 negotiators …negotiators typically lose up to 42% of the total potential value of a transaction. While this is due to distrust and lack of communication, the root of the problem is that the majority of negotiators have no strategy. They negotiate with their “gut” and allow emotions to drive their demands. Consequently, it becomes nearly impossible to develop open, honest, and transparent partnerships that allow for the creation of added value.

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Croatia Friday issued an arrest warrant for MOL Chairman and Chief Executive Zsolt Hernadi who had failed to show up for questioning in connection with a corruption case in which the former Croatian prime minister Ivo Sanader was convicted. Mr. Sanader was jailed for 10 years in November for taking bribes from MOL for granting the company full management rights over INA in 2008. He was prime minister from 2003 to 2009.

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“Exhorting pressure with means outside the realm of economy…is unacceptable in the European Union and Hungary cannot leave these steps unanswered,” the Hungarian government said.

I find the Hungarian government’s position odd and counterproductive – for Hungary and its citizens. Bribery itself is outside of the realm of standard healthy and legal economic practice – according to EU regulations and the US Foreign Corrupt Practices Act. Croatia tried and convicted it’s former Prime Minister for taking a 10 million Euro bribe from the MOL executive in question for a sweetheart deal on INA.

Hungary refused Croatia’s request to question the executive on the basis that it was against Hungary’s national interests (as reported). The Hungarian government owns +25% of MOL’s shares, so I understand the financial and strategic interests in not rocking the MOL boat. But this is extreme short term thinking. Hungary’s long term economic interests are best served by eradicating corruption – in Hungary, in Croatia and everywhere. The citizens of Hungary and Croatia have all paid too high a price for corrupt business practices in the past two decades of economic transformation – and both governments owe it to their citizens to ensure that all bribe taking and bribe paying stop.

“The future of tennis has arrived — and his name is Mario Ancic,” Boris Becker, the German champion, once said…“This might sound clichéd, but the way Mario approached his training as a professional tennis player is how he’s approaching his legal career,” Carfagna said. “He’s like a sponge, indefatigable, and intensely committed to be the best lawyer he can be.”

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“The problem in Europe with the deficits and the debt crisis is that many European countries have spent money they don’t have. The problem in Norway is that we don’t spend money we do have. That requires a kind of political courage.”

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“When it comes to Dreamliners I would say it’s a rather nervous dream,” Wlodzimierz Karpinski told Polish public radio in an interview. “I’m angry. There are problems not only for the Polish airlines. I want to ensure that we will seek compensation from the producer with full determination.” …LOT has already said it was demanding compensation for lost revenue linked to a number of Dreamliner problems and has given Boeing until the end of the year to settle over faults or face court action.

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I’ll huff and I’ll puff until I blow myself away. Compensation for loss of revenue – good luck with that Minister Karpinski. Boeing and LOT are big boys and I am sure that they negotiated appropriate performance and reliability guarantees and penalties for not meeting them – and limitations of liability. It’s usually best to start by reading the contract, or at least be briefed on it.

After a change of management and directors, precipitated by a disagreement with the government over redundancy compensation, Cyprus Airways submitted its new Turnaround Plan to the European Commission in Jul-2013…The Commission’s review is currently expected by Nov-2013 and this has led to the delay in publication of its half year results for 2013. In the event of non-approval of the state aid, Cyprus Airways is working on alternative plans, including the use of subsidiary Cyprair Tours to take over the AOC and assets of the company.

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This is key – ˝The study also found that the growth of Chinese manufacturers has resulted in a slight shift in the behaviour of freight wagon manufacturers which traditionally have supplied a single continent or secured their largest orders from within their home market. Manufacturers from China are increasingly delivering to Africa and South America, and more recently to Australia and the Asian region of the CIS. They are also making the first tentative steps into the European marketplace. –

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“You’re either number one, or you’re struggling to survive,” said David Rubenstein, an analyst at Advanced Research in Tokyo. “The golden years are over. You have consolidation in a mature industry.”

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˝These guys are building their business on the notion/dream that somehow the internet can disintermediate social and relationship capital. I’d argue that this is precisely what the internet can not do: if you’re going to invest in a startup, you’d better know the founders, and you’d better know something that most people do not know. Information asymmetry is the only way to lower the risk profile on such crazy risky investments.˝

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