Europe faces big business losses

BERLIN:

Utilities group Uniper on Friday asked the German government for a bailout and warned that losses could reach 10 billion euros ($10.15 billion) this year, as Moscow’s economic war with the Europe claims even more victims.

Uniper, which is struggling to cover its delivery obligations as falling Russian supplies have pushed up gas prices, said it was seeking additional financing through an increase in a credit facility with the state-owned bank. KfW.

“If you look at the price disparities and the missing volumes, we could rack up 10 billion euros in losses this year,” chief executive Klaus-Dieter Maubach told a press conference at the company’s headquarters in Düsseldorf. .

He also said consumers should be aware that “very, very high price surges” were still going on once sky-high wholesale prices were passed on.

But gas supplies were not yet curtailed, he added, and there was no prospect of imminent insolvency.

SPD politician Andreas Bovenschulte told the upper house of parliament on Friday that he had heard of a possible 9 billion euro cash injection into Uniper on the table, confirming media reports of the amount of the sum.

Uniper was hardest hit by a price spike following Russia’s invasion of Ukraine and Moscow’s subsequent cut on gas supplies. The company said its Finnish majority shareholder, Fortum, had made a proposal to the German government that includes the cantonment of German companies critical to the system under government ownership.

Published in The Express Tribune, July 9e2022.

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Mary I. Bruner