Police said the explosive device was hidden near Pukanic's car, which the two men had been approaching when it detonated.

The attack is the third mafia-style killing in Zagreb since the beginning of the month.

At the weekend, police put together two photo-fit pictures matching a description of a man seen at the scene of the explosion.

Controversial journalist

Pukanic, 47, was considered one of Croatia's most controversial journalists.

He was close to many top politicians, including Stipe Mesic, Croatia's president, but during the past few years independent press reports had also linked him with criminal circles.

Pukanic was the first Croatian journalist to be killed locally since the country's 1991-1995 war for independence.

His death came only months after he survived a gun attack in the Croatian capital in April, the assailant was not found.

Pukanic's funeral is to be held later on Monday in Velika Gorica, just outside Zagreb.

Earlier this month, Ivo Sanader, Croatia's prime minister, sacked his interior and justice ministers and the head of the national police after a daughter of a prominent lawyer was shot dead.

Tackling organised crime is one of the conditions Croatia must meet on its path towards membership of the European Union.

Crotia is aiming to join the 27-member bloc by the end of the decade.

Serb offer

On Saturday, neighbouring Serbia offered to help Croatia find the perpetrators of the Pukanic's murder.

Ivica Dacic, Serbia's interior minister, said: "We will provide all our intelligence data to Croatian services. We believe that this is a common problem, which does not hit only Croatia and we are ready to help solving all open issues  related to crime and crimes."

Two Belgrade-based tabloid newpapers speculated on Saturday that members of a Serbian criminal gang were involved in the assassination, but police denied the reports.

Suzana Vasiljevic, a Serbian interior ministry spokeswoman, said: "There are no indications at all that the murderers have any links with Serbia."