Germany, Europe: The government of Germany agreed to the nationalization of utility energy giant Uniper as it aims to keep the industry afloat in the wake of the worldwide energy crisis.
The state of Germany is set to own around 98.5 percent of Uniper. Having already accepted in the month of July to bail out the major gas imported with a 15 billion euro ($14.95 billion) rescue deal.
Fortum declared in a statement on Wednesday morning, “Since the stabilization package for Uniper was agreed in July, Uniper’s situation has further deteriorated rapidly and significantly; as such, new measures to resolve the situation have been agreed.”
Moreover, the largest import gas of Germany-Uniper has been squeezed by vastly reduced gas flows from Russia, which has increased costs.
Earlier this month, the Russian state-owned energy giant Gazprom indefinitely stopped the gas flows to Europe through the Nord Stream 1 pipeline. The CEO of Uniper, Klaus-Dieter Maubach, shared the information, which would exacerbate the company’s struggles.
Fortum will deconsolidate Uniper as of the third quarter of 2022, the company mentioned on Wednesday, while Fortum’s 4 billion euro loan to Uniper will be repaid as well as the Finnish company will be released from a 4 billion euro parent company guarantee.
Along with this, the CEO of Fortum- Markus Rauramo, mentioned in the statement, “Under the current circumstances in the European energy markets and recognizing the severity of Uniper’s situation.”
“The role of gas in Europe has fundamentally changed since Russia attacked Ukraine, and so has the outlook for a gas-heavy portfolio.”