Why is the federal government nationalizing the energy company Uniper?
Helmut Buender
Business correspondent in Düsseldorf.
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Christian Geinitz
Business correspondent in Berlin
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Uniper is the largest German natural gas importer and the most important operator of gas storage facilities.
More than a hundred municipal utilities get their gas from Uniper, as well as many industrial customers who buy directly from Uniper.
Uniper obtained more than half of the fuel from Russia.
The company now has to buy the missing quantities elsewhere for much higher prices, but has so far only been able to pass some of these on to customers because of the current contracts.
According to the Finnish parent company, this has resulted in net losses of 8.5 billion euros for Uniper.
The federal government fears that the group and with it the German gas supply could collapse.
How does nationalization work?
The federal government is planning a capital increase of eight billion euros.
In return, the federal government will receive new shares at a price of EUR 1.70 each.
In addition, the state wants to take over the entire 78 percent stake previously owned by Fortum for EUR 1.70 per share.
A further 480 million euros will be due for this.
As a result, the federal government will then own 98.5 percent of the shares in Uniper.
The rescue package still has to be approved by the European Commission, and the Uniper general meeting must also formally approve the entry of the federal government.
How long does the nationalization take?
Economics Minister Habeck expects the antitrust and state aid review to take three months.
Then all permits should be available.
This is important because the gas surcharge, which was introduced primarily to support Uniper, will take effect on October 1st.
On October 20, one month later than planned, Uniper and the other importers will then receive the first advance payments from the levy.
At this point, and presumably until the end of January, Uniper will remain a private company with the semi-public majority owner Fortum.
According to the law, after three months, when Uniper is nationalized, the gas levy could be set to zero.
Uniper boss Klaus-Dieter Maubach expects the levy to continue until April 2024.
Apart from the gas business, what else ends up with the federal government?
With around 11,500 employees in more than 40 countries, the Uniper Group is one of the largest electricity producers in the world with a capacity of 33 gigawatts (as much as around 30 nuclear power plants generate).
The portfolio also includes coal and gas-fired power plants in Russia, as well as numerous plants in Germany (such as the Datteln 4 hard coal-fired power plant) and Western Europe.
In Sweden, Uniper has stakes in several nuclear power plants.
In addition to gas, the company trades energy and commodities such as coal and oil throughout the world.
Uniper is one of the largest traders in liquefied natural gas (LNG) and involved in the construction of import terminals.
The Uniper share loses a lot, that of Fortum is strongly
positive.
Why?
By joining the federal government, the Uniper minority shareholders lose a large part of their stake.
In addition, there will be no dividends as long as the federal government is in the company.
Fortum has to write off most of the purchase price paid for Uniper, which according to the Ministry of Economic Affairs totaled 8 billion euros.
But the Finns are out of the risk.
Loans and guarantees already granted to Uniper totaling 8 billion euros will be returned, and the resulting liquidity gap will also be covered by the federal government.
What happens in the meantime until the capital increase?
To ensure that Uniper does not run out of money, the federal government must support the company with further loans.
To this end, the state-owned KfW bank Uniper is to “make funds available according to its liquidity needs”.
The credit line of 9 billion euros agreed in July had already been expanded to 13 billion at the end of August.
The additional demand will depend on when Uniper is allowed to pass on its additional costs for gas procurement and how prices develop.
Do other energy suppliers also need state aid?
The former Gazprom Germania, today Sefe, as the second largest German gas trader, is already under the trusteeship of the Federal Network Agency.
The federal government has so far supported the company with around 10 billion euros.
The federal government is examining whether to convert the loan into equity, i.e. to participate directly.
The third largest gas supplier, Leipzig-based VNG, is also calling for state aid.
She gets most of her supplies from Sefe and argues with Sefe about who should bear the cost of getting replacements.
What are the reactions from politics and business?
As expected, very different.
SPD parliamentary group leader Matthias Miersch welcomed the nationalization of Uniper as an "important and necessary step towards stabilizing the German energy supply".
However, Miersch reported legal doubts about the gas levy.
The Verdi union also sees the takeover by the federal government as positive.
It guarantees the security of supply and is in the interests of the employees.
On the other hand, an insolvency of Uniper would have been an incalculable risk for the gas market.
The environmental organization BUND sees the nationalization as "the beginning of the end of the fossil energy company Uniper".
Under federal influence, the company had to “say goodbye to coal and gas and become a relevant player in the energy transition”.
Criticism comes from the opposition.
CSU regional group chief Alexander Dobrindt said,
the nationalization was long overdue and should have taken place in July.
The delay has led to uncertainty in the market.