Germany to Bail Out Utility Hit Hard by Russian Gas Shortfall
Germany will take a 30% stake in Uniper SE UN01 -28.90%▼ and provide a bailout deal after the ailing utility company was hit hard by dwindling supplies of Russian gas and rising energy prices.
Uniper, Germany’s largest importer of Russian gas and one of Europe’s largest utilities, has hemorrhaged cash daily as it has been forced to buy supplies at much higher prices from alternative sources after Russia reduced deliveries in June.
Russia restarted the Nord Stream pipeline on Thursday after 10 days of annual maintenance but supplies continued to be capped at 40% of its capacity. Moscow blamed technical problems for the Nord Stream shortfall, which German officials have described as an economic attack.
With a total price tag of around 15 billion euros, equivalent to $15.3 billion, in government-funded equity and credit lines, the bailout makes Uniper one of the biggest corporate victims of Russia’s campaign to weaponize gas deliveries to Europe.
A Uniper gas-fired power plant in Gebersdorf, Germany.Photo: Nicolas Armer/Zuma Press
Uniper shares whipsawed after the bailout announcement and were last down around 27%.