Uniper applies for €4b in emergency credit

Uniper, a subsidiary of Finnish energy company Fortum has applied for €4 billion ($4 billion) in extra credit to help it cope with higher energy prices in the wake of the Russian invasion of Ukraine.

The company on Monday announced that its liquidity position has further deteriorated due to ongoing gas curtailments and rapidly increasing energy prices, said Fortum in a press release.

Uniper on Monday drew down EUR 2 billion under its existing credit facility with the German state-owned KfW Bank.

The company requested the extension of the KfW credit facility by additional EUR 4 billion as the discussions with the German government and Fortum on the implementation of the company’s stabilisation package are still ongoing.

As agreed by the parties of the stabilisation package, Fortum will not provide any further financing to Uniper.

An existing credit line of €9 billion has already been used up, reported Germany news agency dpa.

Uniper applied for state aid in July and received it two weeks later as part of a rescue package from the government.

Due to the sharp reduction in Russian gas supplies via the Nord Stream 1 Baltic Sea pipeline, Uniper has had to buy more expensive gas on the market in order to fulfil its contracts. This has led to liquidity problems.

The group plays a central role in providing energy to Germany and supplies more than 100 municipal utilities and industrial companies, the dpa added.

Earlier in late July, Germany decided to acquire 30 percent stake of Uniper.

On July 18, Uniper has drawn on its €2 billion credit facility from Germany's state-owned KfW bank.

Minister for European Affairs and Ownership Steering Tytti Tuppurainen on 14 July visited Berlin and discussed the financial difficulties facing energy company Uniper with German Minister for Special Affairs and Head of the Chancellery Wolfgang Schmidt and State Secretary for Financial Market Policy and European Policy Jörg Kukies.

Earlier on July 8, Fortum's subsidiary Uniper seeks German government support.