Hungary has threatened Croatia with legal action in response to a European arrest warrant issued by Zagreb for the head of local energy group MOL.

The Hungarian government "cannot allow these steps - against the biggest investor in the country - to go unanswered," it said in a statement on Wednesday.

The government, the largest single shareholder in MOL, said it would ask MOL's management to consider selling its 49.1-percent stake in Croatian oil and gas company INA to the Croatian government or a third party. 

"It is unacceptable for the Hungarian government that first the strategic partner is selected ... which makes significant investments and saves Croatia's most important company INA during the crisis, and then there are attempts to intimidate this strategic partner later on with non-economic means, in order to regain control of INA without a buyout," the government statement said.

It added that Hungary's foreign minister was pulling out of a planned visit to Croatia this week.

MOL, like INA partly state-owned, earlier described as "unjust" the Croatian police's issuing on Tuesday of a European arrest warrant for Zsolt Hernadi, its chief executive.

Hernadi is suspected of striking a deal in 2008 with Ivo Sanader , the former Croatian prime minister under which the company paid 10 million euros ($13.5m) in return for assuring MOL's control of INA.

Sanader, who led the Croatian government from 2003 to 2009, was sentenced to 10 years in prison in November for corruption, including for receiving five million euros over the alleged MOL deal.

Croatia's prosecutors have twice asked Hungary to question Hernadi, and twice sought to interrogate him in Zagreb, but all requests have so far been denied.

The most recent hearing was scheduled for September 25, and Hernadi again failed to appear. The Zagreb tribunal then ordered his detention.

Hungarian prosecutors in January said they would not be filing charges after dropping a probe.

Source: Agencies