Uniper Shares Fall Following German Government Bailout Details
22 Juli 2022 - 2:04PM
Dow Jones News
By Giulia Petroni
Uniper SE trades lower on Friday after details of a bailout deal
with the German government were disclosed, erasing earlier gains in
the day.
At 1126GMT, shares are down 23% at EUR8.09.
Germany agreed to acquire an approximately 30% stake in the
utility via a capital increase of about 267 million euros ($272.4
million), rescuing the struggling utility severely hit by curtailed
Russian gas supplies and high prices. Following the capital
increase, shareholder Fortum Oyj will hold a 56% stake in the
company, down from about 80% previously.
Uniper will also have access to additional financing from
state-owned bank KfW, which will increase the existing credit line
to EUR9 billion. The company has already drawn out a EUR2-billion
credit line from KfW and got EUR8 billion in financing from Fortum
earlier this year.
To limit continuing financial losses from supply cuts and price
spikes, the government also plans to let gas importers pass through
90% of the costs to replace Russian gas onto customers as of Oct.
1.
The standoff between Europe and Russia has caused energy prices
to spike and raised fears of insufficient storage levels ahead of
winter as supply remains reduced. The Nord Stream pipeline linking
Russia's Siberian gas fields with Germany though the Baltic Sea
restarted on Thursday after a 10-day maintenance period, but flows
are still at about 40% of capacity.
Uniper, Germany's biggest buyer of Russian gas, has only
received 40% of contracted volumes from Russia's state-owned
exporter Gazprom PJSC since mid June and has had to cover
shortfalls at significantly higher prices on the spot market.
The company will now convene an extraordinary general meeting to
get shareholder approval for the stabilization measures.
Write to Giulia Petroni at giulia.petroni@wsj.com
(END) Dow Jones Newswires
July 22, 2022 07:49 ET (11:49 GMT)
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