A spokesman for the federal government confirms that Uniper is being rescued. The share jumped on the Frankfurt Stock Exchange.
Collateral victims of the war in Ukraine, the German energy supplier unite
could be rescued from Berlin. A spokesman for the federal government has confirmed that the company is being rescued. Berlin’s preferred option would be for the state to participate up to 30% of the capital the group for around €5 billion, according to sources familiar with the matter, saying a deal could be finalized within the week.
According to the Reuters news agency, talks are currently taking place between the German and Finnish governments about the company, considering that Uniper’s majority shareholder is the Finnish joint-stock company. Forum.
At the same time the Deutsche Volksbank KfW was able to increase its credit line to Uniper from 2 to 8 billion euros, reports the daily Handelsblatt.
That information sent the action skyrocketing, climbing to 17% on the Frankfurt Stock Exchange on Wednesday.
The tip of the eisberg
After that, the company Uniper got into great financial difficulties western sanctions Imposed on Russia because of the war in Ukraine. In retaliation, Moscow began cutting back on Russian gas supplies. The German company bought 54% of its volume in Vladimir Putin’s land. With the restrictions, it can count on only 40% of flows from Russia. To make up for this shortage, it is forced to shop on the spot market, where prices have risen by more than 500% in a year.
That’s what Citi analysts rated with a loss of 30 million euros per day that Uniper suffered with these replacement purchases. Added to this are the down payments that the Group has to make as a guarantee for the delivery of the quantities sold. These are calculated between the selling price and the spot market price. In other words, Uniper soon ran into serious financial difficulties.
“With EDF (which has just been bailed out by the French state), Uniper is just one utility among a dozen others serving more than 200 million homes across the European Union and the UK.”
This is why Bloomberg columnist Javier Blas says Uniper represents the tip of the iceberg of the sector’s difficulties in Europe. “With EDF (which has just been bailed out by the French state), Uniper is just one energy supplier among a dozen others serving more than 200 million homes in the European Union and the UK,” he recalls. “The majority of these companies will weather the storm. But many more will need help. Cash market. At most companies could be nationalized, if only temporarily.”
The President of Blackrock France, Jean Francois Cirelli, expressed concern about a potential “Lehman Brothers” in the energy sector in an interview with Les Echos daily in April. As a reminder, the bankruptcy of American bank Lehman Brothers in September 2008 caused serious financial difficulties throughout the global banking sector. In Belgium, the Dexia bank had been broken up and its banking business nationalized. Fortis was acquired by BNP Paribas. KBC had received financial support from the Flemish government.
RWE and engineering, two large groups in the energy sector in Europe, have already announced that their situation differs from that of Uniper. Nevertheless, investors in the stock markets do not share the optimism of the two companies. RWE has lost more than 15% since its last peak on April 23. Engie is down 19% since its last peak on Feb. 25, a day after Russia invaded Ukraine. Uniper saw its stock melt down more than 60% over the same period as Engie.
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