Tax billions to save
Uniper shareholders open the door to the state
12/19/2022, 4:31 p.m
The federal government can join Uniper. The utility’s shareholders give the green light for this. With a capital increase and the issue of new shares, the group is to be saved from collapse. The reason for the imbalance is the cessation of gas supplies by Russia.
The Uniper shareholders have cleared the way for the extensive nationalization of the ailing energy company. At an extraordinary general meeting, the owners of Germany’s largest gas trader voted in favor of the stabilization measures agreed with the federal government and the previous Finnish majority shareholder Fortum. “This situation hurts, but there are no other options,” CEO Klaus-Dieter Maubach had previously asked for support. He left little doubt about what else was threatening. “Then there may be a risk of insolvency. From the point of view of the board of directors, a possible insolvency would lead to a complete loss for the shareholders.” The EU Commission is still examining the plans under state aid law. It is expected that she will only give the green light under conditions, such as the sale of shops.
Among other things, the rescue package provides for a capital increase of eight billion euros, which only the federal government is entitled to subscribe to. The federal government will also take over Fortum’s stake in Uniper. The federal government will then hold around 98.5 percent of Uniper. Since Fortum had previously been Uniper’s majority shareholder with around 78 percent, approval of the stabilization measures was considered certain. The Federal Ministry of Economics announced the implementation “probably this week”. In addition, up to 25 billion euros should come in through the issue of new shares.
The Federal Ministry of Finance will be responsible for the stake in Uniper in the future. “In addition, the company will not distribute any dividends until the end of stabilization without the consent of the federal government,” emphasized the Düsseldorf-based company. Federal Minister of Economics Robert Habeck spoke of a significant step that had never been seen before in the history of the Federal Republic. “Uniper supplies about a third of Germany with energy, with gas,” he said in a video recording by the EU Commission.
Uniper: Expect profits again in the medium term
According to its own statements, the group supplies around 1,000 customers on the basis of long-term contracts, in particular municipal utilities and industrial companies. Meanwhile, Habeck said it was essential for Germany’s energy supply to maintain the group. Uniper now has to reposition itself. What is natural gas today must be renewable energy or hydrogen in the future.
At the shareholders’ meeting, CEO Maubach was confident that the company would return to profitability – but only in the medium term. “We expect that in the medium term, once the losses from gas replacement purchases as a result of the non-delivery of Russian gas have ended, we will again generate positive results,” he said.
Meanwhile, the shares of Uniper’s parent company Fortum were sought after on the stock exchange and in some cases rose by more than seven percent. The stock is now rated as a pure provider again, since the risks of entering the state have mostly ended up with the German taxpayer, according to the trade. Fortum is doing fine. However, Uniper had announced that it wanted to hold on to its stake in nuclear power plants in Sweden. There are currently no intentions to sell the nuclear energy business, the hydroelectric power plants in Sweden or parts thereof, it said. Should that change, the previous Finnish majority shareholder Fortum has the right to submit an initial offer until the end of 2026. Uniper papers increased slightly.
Uniper had stumbled because Russia had gradually stopped supplying gas to Germany. In order to be able to meet its delivery obligations to municipal utilities and industrial companies, Uniper had to buy gas expensively on the energy exchanges. The daily losses amounted to over 200 million euros at times. Uniper estimated the losses from the replacement procurement at 14 billion euros. In total, the federal government has granted the company aid of over 50 billion euros. In addition to the capital measures that have been decided, this also involves credit lines from the state-owned KFW Bank amounting to up to 18 billion euros.