Germany's Uniper warned that it would have to consider bankruptcy if shareholders didn't approve a bailout and nationalization that will cost the government more than 50 billion euros ($53 billion).
CEO Klaus-Dieter Maubach warned shareholders at a fictitious extraordinary shareholder meeting that the chaos brought on by the loss of Russian gas supplies could result in shareholders losing everything if they rejected the German proposal.
The largest gas supplier to Uniper was once Russia's Gazprom, but a sharp decline in deliveries following Moscow's invasion of Ukraine forced the German gas importer to buy gas from other sources at significantly higher prices in order to uphold its contracts.
At their meeting on Monday, Uniper's shareholders will vote on two key proposals: the German government's 8 billion euro capital injection and Berlin's ability to make additional, up to 25 billion euro, capital injections.
"(The measures) are indispensable for this company's future," Maubach said. "If approval is not granted, we would have to review very critically the so-called going concern forecast for our company," he added.
"In the Management Board's view, a possible insolvency could lead to a complete loss for shareholders."
According to Maubach, Uniper has access to about 2.5 billion euros in funding at the moment.
Following two share issues, the German government will eventually own just under 99% of Uniper, Germany's largest gas trader, if the bailout is approved. According to Uniper, the stake will be managed by the German Finance Ministry.
As a result, Finland's Fortum, the company's current majority shareholder, will resign. However, Fortum will still have the option to make the first offer for Uniper's Swedish nuclear and hydro assets by the end of 2026, should the company decide to sell those assets.
Uniper stated that it has no current plans to do this.
The importer, who supplies about a third of Germany's gas, suffered the largest loss in German corporate history as a result of the loss of Russian gas, which was Moscow's response to Western sanctions over its invasion of Ukraine.
(Source:www.financialpost.com)
CEO Klaus-Dieter Maubach warned shareholders at a fictitious extraordinary shareholder meeting that the chaos brought on by the loss of Russian gas supplies could result in shareholders losing everything if they rejected the German proposal.
The largest gas supplier to Uniper was once Russia's Gazprom, but a sharp decline in deliveries following Moscow's invasion of Ukraine forced the German gas importer to buy gas from other sources at significantly higher prices in order to uphold its contracts.
At their meeting on Monday, Uniper's shareholders will vote on two key proposals: the German government's 8 billion euro capital injection and Berlin's ability to make additional, up to 25 billion euro, capital injections.
"(The measures) are indispensable for this company's future," Maubach said. "If approval is not granted, we would have to review very critically the so-called going concern forecast for our company," he added.
"In the Management Board's view, a possible insolvency could lead to a complete loss for shareholders."
According to Maubach, Uniper has access to about 2.5 billion euros in funding at the moment.
Following two share issues, the German government will eventually own just under 99% of Uniper, Germany's largest gas trader, if the bailout is approved. According to Uniper, the stake will be managed by the German Finance Ministry.
As a result, Finland's Fortum, the company's current majority shareholder, will resign. However, Fortum will still have the option to make the first offer for Uniper's Swedish nuclear and hydro assets by the end of 2026, should the company decide to sell those assets.
Uniper stated that it has no current plans to do this.
The importer, who supplies about a third of Germany's gas, suffered the largest loss in German corporate history as a result of the loss of Russian gas, which was Moscow's response to Western sanctions over its invasion of Ukraine.
(Source:www.financialpost.com)
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