British power plant owner Uniper eyes ‘potential bankruptcy’ without £44bn government bailout | Business news

[ad_1]

Uniper, the crisis-stricken German gas trader which owns seven power plants in the UK, has warned shareholders it faces “potential bankruptcy” unless they back an additional government bailout worth more than €50bn (£44.6bn).

Chief Executive Officer Klaus Dieter Mobach told investors ahead of a crucial vote on Monday that they risk losing their entire investment in the company if they refuse to bail out German taxpayers.

The company first went to Berlin in June, and later secured €8 billion for the stake of Finnish owner Fortum, after its future was jeopardized by the loss of Russian gas flows amid the war in Ukraine.

The pressure on deliveries from the likes of Gazprom, once its biggest supplier, has forced Uniper to buy gas elsewhere at much higher prices to meet existing contracts.

It caused a net loss of 40 billion euros for the company, which provides about a third of German gas and is its largest importer.

Uniper’s interests in the UK include the coal-fired Ratcliffe-on-Sure terminal and six other gas-fired terminals.

It was revealed last month that it would need additional state support to survive after the German government withdrew a gas tax that was designed to help the country’s gas importers incur additional costs.

This move prevented Uniper from raising customer prices.

Investors will vote on a package that includes up to 33 billion euros in state-backed equity and up to 18 billion euros in credit lines from state-owned bank KfW.

Ahead of Monday’s extraordinary meeting of shareholders in Düsseldorf, Mr Maubach said in his website statement: “(The actions are) indispensable to the future of this company.

He added, “If approval is not granted, we will have to conduct a very critical review of the so-called business continuity outlook for our company.”

“From the board’s perspective, a potential bankruptcy could result in a complete loss for shareholders.”

[ad_2]