Germany’s Uniper SE and Finland’s Fortum Ojy disclosed Russia has seized their subsidiaries within the nation and positioned them underneath federal management.
President Vladimir Putin signed an govt decree Tuesday permitting Russia’s state property administration company to regulate Uniper’s Unipro and Fortum’s PAO Fortum. Each corporations function energy vegetation in Russia and are majority owned by their respective governments.
Kremlin spokesperson Dmitry Peskov mentioned the decree was essential to “cut back dangers” and create a strategy to extract “compensation” for western sanctions and seizures.
“The decree is a response to the aggressive actions of unfriendly international locations, that are aimed toward making a regulatory framework for the precise seizure of belongings of Russian corporations overseas,” Peskov mentioned. Peskov added that the decree might be prolonged to different corporations.
In an replace to traders, Fortum mentioned it was alerted to the takeover in a press launch and a discover from PAO Fortum that its CEO had been changed by the board.
“Fortum thought of the appointment of the brand new CEO to be affirmation that the brand new presidential decree is being enacted and Fortum’s subsidiary has been put underneath non permanent asset administration,” Fortum acknowledged. Fortum’s holding within the subsidiary was valued at $1.9 billion on the finish of final 12 months, in keeping with the agency.
Uniper since final 12 months has been working to promote its majority stake in Unipro. The agency mentioned in December it could promote its 83.7% holdings to a Russian agency, however was nonetheless awaiting approval from federal authorities. The corporate, as soon as one of many largest European consumers of Russian pure fuel, wrote off the Russian belongings final 12 months, reserving a virtually $4.8 billion loss.
Uniper has additionally been making an attempt to get better a few of its losses from Russia’s state-owned Gazprom PJSC for failing to ship on its fuel contracts by arbitration. Uniper reportedly misplaced greater than $12 billion final 12 months changing misplaced Russian pipeline fuel at larger spot costs
Russia exported round 140 billion cubic meters (Bcm) of pipeline fuel to Europe in 2021, largely by a direct path to Germany. Pipeline exports from Russia have now dropped to roughly 25 Bcm/12 months by Ukraine and Turkey.
The decree comes lower than a month after Finland entered the North Atlantic Treaty Group. The European Union has additionally been growing calls to additional cut back fossil gas purchases from Russia, together with for liquefied pure fuel.