Germany’s Uniper Will Need €25 Billion More in Bailout

German energy company Uniper, the biggest corporate victim of Europe’s energy crisis so far, said Berlin would need to spend an additional €25 billion into the company to cover losses caused by Russia’s invasion of Ukraine and the subsequent gas supply cuts from Moscow that sent European gas prices soaring. The amended bailout deal reflects the cancellation of a gas levy designed to help German gas importers bear additional costs, and raises the tally for Uniper’s nationalization to more than €51 billion.

It was said last month that Uniper would need tens of billions of euros more in additional funding to stabilize the company after Berlin decided not to impose a levy, which would have allowed gas companies to pass on most of the higher procurement costs to customers.

“It’s about nothing less than a substantial portion of Germany’s gas bill, which will now be paid out of tax revenues – and not, as originally planned, through a gas surcharge,” Uniper CEO Maubach said on Wednesday.

“Without this relief, our customers, including many municipal utilities, would inevitably have faced an even higher wave of costs,” he added.

Uniper, Germany’s largest gas importer, said under the most recent agreement, Berlin will subscribe to tranches of authorized capital totaling up to €25 billion to cover losses from outstanding Russian gas volumes until 2024.

The country’s economy ministry said this would happen “only to the extent that Uniper can demonstrate a need for capital (in particular in connection with replacement procurement costs)”.

Investors will vote on the deal at a meeting on Dec. 19 to several measures, including up to €33 billion in state-backed equity, up to €18 billion in credit lines from state-lender KfW and €500 million to buy out Uniper parent Fortum.

The European Commission will still need to approve the deal under state-aid and merger-control law. Uniper said it was in talks with the Commission, expecting to get the green light from Brussels before the planned shareholder meeting.

Uniper nearly collapsed this year after its biggest supplier Gazprom had cut gas flows. The company faced a €40 billion net loss, the biggest in German corporate history. It forced Germany to nationalize Uniper to avoid a “Lehman-Brothers type” effect in the energy industry.

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