Chancellor Olaf Scholz said the government will take a 30% stake in energy firm Uniper. The wholesale gas importer faces huge losses due to soaring energy prices and a threat by Russia to cut gas supplies.
© Ina Fassbender/AFPUniper's largest stakeholder, Finnish energy firm Fortum, has approved the bailout.Germany has finalized a plan to bail out energy firm Uniper, Chancellor Olaf Scholz confirmed on Friday.
The wholesale gas and electricity importer is threatened with bankruptcy over skyrocketing energy prices from the Ukraine war.
What are the terms of the bailout?
Scholz told a news conference in Berlin that the German government will take a 30% stake in the energy firm.
Scholz said his administration would make up to €7.7 billion available as hybrid capital and expand a credit line to €9 billion through the state-run bank KfW.German business daily Handelsblatt said the government was considering creating fixed-income securities that automatically convert into shares in Uniper at the end of their term.
Uniper's largest shareholder, Finnish energy firm Fortum, has signed off on the plan, the company confirmed on Friday.
Fortum's stake is expected to be reduced significantly as a result of the bailout.
Scholz said Uniper would be allowed to pass on cost increases to its customers despite having fixed-price contracts in place.
He said customers could expect further price increases beginning in the fall, but promised further aid for households who have problems paying their energy bills.
Why is Uniper important?
Uniper is an international energy group that sells electricity and gas to wholesale customers such as regional utility firms. It is also Germany's largest importer of Russian gas.
The firm requested state aid two weeks ago after Russian energy giant Gazprom cut gas deliveries to Europe.
Earlier this week, Uniper's CEO Klaus-Dieter Maubach said the firm had fully utilized a €2 billion credit line from KfW after being forced to secure gas supplies from other sources.
Germany remains heavily reliant on Russian gas imports, which accounted for 26% of gas consumed in June, according to the Economy Ministry.
Russia had closed the Nord Stream 1 pipeline, which runs under the Baltic Sea to Germany, for 10 days for maintenance.
Berlin had feared Moscow would permanently turn off the taps in retaliation for Western sanctions over the Ukraine war.
Nord Stream 1 did restart supplies on Thursday. but the flow is again at just 40% of normal capacity.
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