The crisis-hit German gas trader Uniper, which owns seven power plants in the UK, has told shareholders that the company faces “potential collapse” unless they support a further state rescue of more than €50 billion (£44.6 billion).
Before a pivotal vote on Monday, Chief Executive Klaus-Dieter Maubach warned investors that if they rejected the German government rescue plan, they run the possibility of losing all of their assets in the company.
The company’s future was put in jeopardy by the loss of Russian gas flows amid the conflict in Ukraine, so it initially went cap in hand to Berlin in June. Later, it was able to secure €8 billion in exchange for Finnish owner Fortum’s stake.
Uniper had to purchase gas from other sources at substantially higher prices to fulfil existing commitments due to the restrictions on supply from companies like Gazprom, which was once its major supplier.
The firm, which supplies almost a third of Germany’s gas and is its largest importer, suffered a net loss of €40 billion as a result.
The Ratcliffe-on-Soar coal-fired power station and six additional gas-fired units are among Uniper’s UK investments.
The German government’s withdrawal of a gas fee, which was intended to assist the nation’s gas importers in bearing increased costs, was made public last month and disclosed that it would require additional state assistance to survive.
The action stopped Uniper from increasing client prices.
A plan that includes up to €33 billion in state-backed stock and up to €18 billion in credit lines from state-lender KfW will be put to the vote by investors.
The steps are essential for the future of this company, Mr. Maubach declared on his website ahead of Monday’s extraordinary shareholder meeting in Düsseldorf.
He continued, “If approval is not given, we would have to reassess the so-called going concern prediction for our company extremely closely.
A potential insolvency, in the management board’s opinion, “might result in a full loss for stockholders.”