CEE MARKETS-MOL highest since 2007 on deal for Russian stake in NIS refinery, CEZ shares fall again

BUDAPEST, Jan 20 (Reuters) - Shares in MOL MOLB.BU rose to their strongest level since 2007 on Tuesday after the Hungarian oil and gas group reached a provisional agreement to buy Russia's Gazprom Neft majority stake in Serbian refiner NIS.

NIS supplies about 80% of Serbia's fuel market and holds around half of the retail segment, but it was hit by U.S. sanctions last year due to its Russian ownership.

MOL's shares have climbed over the past month as talks over NIS stake built, and climbed as much as 1.5% on Tuesday after MOL confirmed the deal in after-hours trading on Monday. Shares were up 0.1% at 1004 GMT, giving up morning gains.

However, MOL outperformed the wider market - with Budapest's blue-chip index .BUX down 0.4% - and its shares traded at their strongest level since October 2007 after rising more than 20% since the start of the year.

The details of the deal were not yet clear, but Gazprom Neft's stake and the governing rights in NIS were estimated to be worth 1.2 billion euros ($1.41 billion) previously, Erste's regional energy analyst Tamas Pletser wrote in a note.

"If MOL acquires the company's shares from Russia's Gazprom Neft at or below this price along with full management control, this would be favorable news for MOL shares," he said.

CEZ FALLS, AND CZECH DEFENCE GIANT ANNOUNCES IPO

Elsewhere, Prague .PX was down 1.3%, with Czech utility CEZ CEZP.PR falling as much as 6%, on course for its biggest one-day drop since March 2024.

CEZ fell 4% in the previous session, and one investor said it could be tied to a low price target from one broker in a new report and people also freeing up funds for an upcoming share offering.

On Tuesday, Prague-based Czechoslovak Group (CSG) said it would float up to a 15.2% stake in an initial public offering in Amsterdam, giving it a market capitalisation of 25 billion euros ($29.19 billion) in potentially the biggest ever defence sector listing.

"It is probably not entirely out of the question that money is being collected to free up hands for Friday's IPO of Czech CSG," Michal Snobr, a Czech investor who has been an active CEZ shareholder, said on X.

CURRENCIES DOWN, WATCHING GEOPOLITICS

Currencies were a touch weaker as investors eyed geopolitical tensions from Greenland to Iran and Ukraine.

Trump threatened on Saturday to implement a wave of increasing tariffs from February 1 on eight European countries until the U.S. is allowed to buy Greenland, fuelling fears of a renewed trade war.

The Hungarian forint EURHUF= was a touch weaker, trading at 385.55 per euro. The Polish zloty EURPLN= eased 0.1% to trade at 4.2280 to the euro. The Czech crown EURCZK= was 0.1% lower and trading at 24.317. Romania's leu EURRON= was little moved after the central bank held its benchmark interest rate at 6.50% as expected on Monday.

($1 = 0.8532 euros)