German government could raise stake in gas supplier Uniper

Sep 14, 2022, 5:13 AM | Updated: 5:46 am

BERLIN (AP) — German energy supplier Uniper said Wednesday that it is exploring the possibility of the government acquiring a majority holding in the company as its losses mount, a jump from the roughly 30% stake that the state already has pledged to take.

The government put together the rescue package in July after Russia’s cuts to natural gas supplies forced Uniper to buy gas at far higher prices on the market to fulfill its supply contracts. As the energy crisis drives up prices, the European Union’s executive Commission has proposed measures to help households, including tapping into the extraordinary profits of electricity producers.

Uniper is majority-owned by Finland-based Fortum, in which the Finnish government holds the largest stake.

Uniper said in a statement that “due to the increased uncertainties in the operating environment, the parties are also looking into alternative solutions,” including “a straight equity increase that would result in a significant majority participation by the German government in Uniper.”

It added that no decisions have yet been made beyond the July rescue package.

It includes a roughly 267 million-euro capital increase signed by the German government alone and an additional 7.7 billion euros through a tool that provides equity by issuing company shares — as Uniper’s cash needs require. An existing 2 billion-euro credit facility from Germany’s state-owned KfW development bank was increased to 9 billion euros.

The government also decided to introduce a new levy on natural gas, aimed at rescuing importers slammed by the Russian cutbacks tied to the war in Ukraine. It later moved to lower value-added tax on gas from 19% to 7% until the end of March 2024 in an effort to make up for the effect of the surcharge.

Russia’s Gazprom started reducing gas deliveries to Germany through the main Nord Stream 1 pipeline in mid-June, citing alleged technical problems and the effect of Western sanctions. German officials have dismissed that explanation as an excuse for a political decision to create uncertainty and drive up prices.

Russia, which before the reductions accounted for a bit more than a third of Germany’s gas supplies, has since cut off deliveries through Nord Stream 1 altogether.

As a result of that cutoff and extremely high and volatile gas and power prices in Europe, Uniper said its “financial losses due to the higher gas procurement cost have significantly increased.”

In a separate move last week, gas importer VNG also sought help from the German government.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

FILE - A bottle of Jack Daniel's Tennessee Whiskey is displayed next to a Bad Spaniels dog toy in A...

Associated Press

Ruff day in court: Supreme Court sides with Jack Daniel’s in dispute with makers of dog toy

The Supreme Court on Thursday gave whiskey maker Jack Daniel's reason to raise a glass, handing the company a new chance to win a trademark dispute with the makers of the Bad Spaniels dog toy.

1 day ago

(Pixabay Photo)...

Associated Press

6 arrested in alleged scheme to fraudulently collect millions in COVID aid meant for renters

Six people from Washington, Arizona and Texas have been arrested and accused of fraudulently obtaining millions of dollars of COVID-19 aid from an assistance program meant for renters, federal prosecutors said.

1 day ago

FILE - Protesters stand outside of the Senate chamber at the Indiana Statehouse on Feb. 22, 2023, i...

Associated Press

LGBTQ+ Americans are under attack, Human Rights Campaign declares in state of emergency warning

The Human Rights Campaign declared a state of emergency for LGBTQ+ people in the U.S. on Tuesday.

3 days ago

FILE - People wait in line outside the Supreme Court in Washington to listen to oral arguments in a...

Associated Press

Supreme Court opened the door to states’ voting restrictions. Now a new ruling could widen them.

Within hours of a U.S. Supreme Court decision dismantling a key provision of the Voting Rights Act, Texas lawmakers announced plans to implement a strict voter ID law that had been blocked by a federal court. Lawmakers in Alabama said they would press forward with a similar law that had been on hold.

3 days ago

Gavel (Pexels Photo)...

Associated Press

Ex-teacher sentenced to prison for making death threat against Arizona legislator

A former Tucson middle school teacher was sentenced Tuesday to 2 ½ years in prison after pleading guilty to making a death threat against Arizona state Sen. Wendy Rogers.

3 days ago

FILE - Police officers stand outside a Target store as a group of people protest across the street,...

Associated Press

Pride becomes a minefield for big companies, but many continue their support

Many big companies, including Target and Bud Light's parent, are still backing Pride events in June despite the minefield that the monthlong celebration has become for some of them.

4 days ago

Sponsored Articles

...

OCD & Anxiety Treatment Center

5 mental health myths you didn’t know were made up

Helping individuals understand mental health diagnoses like obsessive compulsive spectrum disorder or generalized anxiety disorder isn’t always an easy undertaking. After all, our society tends to spread misconceptions about mental health like wildfire. This is why being mindful about how we talk about mental health is so important. We can either perpetuate misinformation about already […]

...

OCD & Anxiety Treatment Center

How to identify the symptoms of 3 common anxiety disorders

Living with an anxiety disorder can be debilitating and cause significant stress for those who suffer from the condition.

(Photo: OCD & Anxiety Treatment Center)...

OCD & Anxiety Treatment Center

Here’s what you need to know about OCD and where to find help

It's fair to say that most people know what obsessive-compulsive spectrum disorders generally are, but there's a lot more information than meets the eye about a mental health diagnosis that affects about one in every 100 adults in the United States.

German government could raise stake in gas supplier Uniper