In an effort to preserve the sector in the context of a global energy crisis, the German government approved the nationalisation of utility Uniper on Wednesday.
The state will pay 0.5 billion euros to acquire Fortum’s 56% ownership after agreeing in July to bail out the large gas importer with a 15 billion euro ($14.95 billion) rescue agreement. The German government would eventually hold about 98.5% of Uniper.
New measures to address the problem have been agreed upon, according to a statement released by Fortum on Wednesday morning. “Since the stabilisation package for Uniper was agreed upon in July, Uniper’s condition has further deteriorated swiftly and dramatically,” the statement read.
The largest gas importer in Germany, Uniper, has been put under pressure as a result of significantly reduced gas imports from Russia, which have driven up costs.
The Nord Stream 1 pipeline was used to transport gas from Russia’s state-owned energy behemoth, Gazprom, to Europe earlier this month. Uniper CEO Klaus-Dieter Maubach told CNBC that this action would make the company’s problems worse.
According to a statement made by Fortum on Wednesday, Uniper will be deconsolidated starting in the third quarter of 2022. Uniper will also be released from a 4 billion euro parent company guarantee and Fortum’s 4 billion euro debt to the Finnish firm.
According to Markus Rauramo, CEO of Fortum, “the divestiture of Uniper is the proper action to take, not only for Uniper but also for Fortum, given the current circumstances in the European energy markets and recognition of the severity of Uniper’s situation.”
“Since Russia attacked Ukraine, the prognosis for a portfolio with a high gas component has changed fundamentally, as has the significance of gas in Europe. The business rationale for an integrated group is therefore no longer strong.