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    Uniper will Balance Shareholder Interests (Update)


German corporate law allows subsidiaries a lot of room for manoeuvre. Update adds generating capacity fuel data.

by: William Powell

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Natural Gas & LNG News, Europe, Premium, Corporate, Mergers & Acquisitions, News By Country, Finland, Germany

Uniper will Balance Shareholder Interests (Update)

(Adds generating capacity fuel data)

German utility Uniper will be able to balance the interests of its minority shareholders with those of its soon-to-be 70% shareholder Fortum, CEO Andreas Schierenbeck said March 24.

Fortum expects to take bring its shareholding to about 70% this month, paying Elliott Management Corporation and Knight Vinke Energy Advisors around €2.6 ($2.8)bn for "at least 20.5% of the shares. But Schierenbeck said that although Uniper will from then on be a subsidiary of the Finnish state utility, the two companies would have independent boards, under German corporate law; and their own profit and loss accounts.

The minority shareholders have very strong rights, he said. Fortum has also said it would wait two years before buying further shares and squeezing out the other shareholders to give it complete control under a so-called "domination agreement," he said. 

Fortum is anyway in agreement with Uniper's strategy, which is to move out of coal and lignite and into gas and hydrogen, he said. And the two had been in co-operation talks for some time before Fortum agreed to acquire the additional stake. The previous board, under Klaus Schafer, resigned over the issue of Fortum increasing its stake, and Schierenbeck got relations back on to an even keel.

As it is, coal and lignite account for a well under half of Uniper's generating fleet: it has 17.4 GW of gas, 9.2 GW of coal, 3.6 GW of hydro, 1.4 GW of nuclear and 2.8 GW of 'other'. All the coal and lignite assets will be converted to natural gas on closure by 2026 with the sole exception is the Datteln coal plant, which has already been tested and is due to run until 2036, less than half its normal lifespan. 

On Nord Stream 2, he said that all the money that Uniper was due to pay Gazprom under the financing agreement had been paid, "apart from a few million euros," and there would be no extra payments due despite the additional construction costs.

He did not comment on when the second 55bn m³/yr line would start but he said that he had read that the pipelaying vessel, the Akademik Chersky, was on her way to the Baltic Sea from Asia. "I hope as soon as possible," he said. The five western lenders to the project are paying a tenth each of the €9.5bn budget, the other half being paid by Gazprom.