Fortum Gets EUR2.35 Billion Bridge Financing From Finland
06 September 2022 - 10:09AM
Dow Jones News
By Dominic Chopping
Finnish energy group Fortum Oyj said Tuesday it has secured a
2.35 billion euro ($2.33 billion) bridge financing facility from
the Finnish state to ensure access to liquidity amid soaring
collateral requirements.
Fortum said it currently has sufficient liquid funds to meet
collateral needs and utilisation of the bridge financing will be a
last resort.
The Finnish state, Fortum's majority owner, is providing the
liquidity facility through state-owned holding company Solidium.
The first tranche of at least EUR350 million must be drawn by 30
September, 2022, in order for the arrangement to remain effective
thereafter, and the last required tranche might be drawn by 31
March, 2023.
The financing can't be used to cover collateral needs of
Fortum's subsidiary Uniper, it said.
If Fortum draws on the facility, it will be required to issue up
to 8.97 million new shares to Solidium, increasing the Finnish
state's ownership to 51.26% from 50.76%.
"Regulatory changes are urgently needed to curb the unreasonably
high margining and collateral requirements," Chief Executive Markus
Rauramo said.
At market close yesterday, Fortum's standalone collaterals tied
up on Nasdaq amounted to around EUR3.5 billion. At their highest,
the collateral requirements amounted to approximately EUR5
billion.
Write to Dominic Chopping at dominic.chopping@wsj.com
(END) Dow Jones Newswires
September 06, 2022 03:54 ET (07:54 GMT)
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