Nationalization of Uniper – Ukraine War is Reshaping European Energy Industry

The German government has Nationalised Uniper by purchasing 99% of stake.

In September, the German government, Uniper SE, and Fortum Oyj reached an agreement on an amendment to ensure Uniper’s long-term stability. The revised stabilisation package was supposed to allow Uniper to continue supplying energy to Germany.

Uniper is one of Europe’s largest natural gas importers, and Russian Gazprom is one of Uniper’s primary natural gas suppliers. During the first half of 2022, the company lost €12.3 billion due to a reduction in gas supply by Gazprom as Russia reduced supply to Europe by shutting down the Nord Stream 1 pipeline.

The original July stabilisation package included a capital increase, a gas surcharge, and a KfW credit line.

A €8 billion capital increase with an issue price of €1.70 per share was planned. This included a mandatory convertible instrument worth €7.7 billion and a capital increase worth approximately €0.3 billion.

The German government will subscribe to the issued shares, as well as the Uniper shares held by Fortum, for €1.70 per share.

As a result of the transaction, the German government owns approximately 99% of Uniper.

As a result of the bailout, Uniper gained financial clout to continue providing critical energy services to companies, municipal utilities, and consumers throughout Germany.

Uniper is a leading international energy company with approximately 11,500 employees and operations in over 40 countries. By 2035, the company expects its European power generation business to be carbon-neutral.

Previously, the German government asked Uniper to continue operating the Ratcliffe power station, which was scheduled to close in September 2022. As a result, Unit will now be operational until 31 March 2023, contributing to the UK’s energy security during the winter.

If the war continues, Uniper’s losses will be greater, necessitating more assistance from the German government.

Galactik Views

Related articles