An employee inspected above-ground equipment at the energy storage facility of Uniper in Bierwang, southern Germany in June 2022. The natural gas-reliant company is to move all but completely into the ownership of the German state, according to its parent company Fortum. (Lennart Preiss – AFP / Lehtikuva)

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FORTUM and the German government have reached an agreement on the nationalisation of Uniper, a Düsseldorf-based natural gas-reliant subsidiary of Fortum.

The Finnish majority state-owned energy company revealed this morning that it will sell all of its 293 million shares in Uniper to the German state for around 500 million euros, or 1.7 euros per share. Uniper will also repay a four-billion-euro loan to its parent company and release the company from the four-billion-euro guarantee it received earlier this year.

The German government, meanwhile, will inject around eight billion euros in Uniper, raising its stake in the ailing energy company to 98.5 per cent.

The agreement will replace the stabilisation package thrashed out in July.

Markus Rauramo, the CEO of Fortum, viewed in a press release that the divestment is the right decision in the current circumstances and given the severity of the problems of Uniper. The European energy crisis has escalated, making it clear that further measures are required to prevent the collapse of what is the largest gas importer in Germany.

Uniper has to date accumulated close to 8.5 billion euros in losses from its gas business.

“The role of gas in Europe has fundamentally changed since Russia attacked Ukraine, and so has the outlook for a gas-heavy portfolio. As a result, the business case for an integrated group is no longer viable,” said Rauramo.

“We made choices in the past that we were truly convinced of at the time, based on the available information, market environment and outlook. In hindsight, some of our strategic choices turned out to become liabilities. We now have to face and mitigate the impact of those decisions,” he lamented.

Fortum and the German government also agreed that Fortum will have a right of first offer if its subsidiary chooses to divest all or parts of its hydro- and nuclear power assets in Sweden before 2027.

Minister of European Affairs and Ownership Steering Tytti Tuppurainen (SDP) told Helsingin Sanomat that the divestment decision was inevitable given the unusually high uncertainty. The Finnish government owns almost 51 per cent of shares in Fortum.

“Fortum has to protect its financial position in a way that preserves its ability to engage in its basic business operations,” she summarised.

Aleksi Teivainen – HT