This is the second procedure of its kind in a few months, in order to preserve the “security of gas supply” of Germany.
The German state announced on Monday the nationalization of the German subsidiary of the Russian giant Gazprom in order to save from bankruptcy this gas supplier which it has already been administering since April and which is over-indebted.
This is to guarantee thegas supply securityfrom Germany, the German economy ministry said in a statement. Berlin is thus nationalizing for the second time in a few months a leading energy group, after having already saved the German Uniper, asphyxiated by the Russian gas cuts. The SEFE company, which previously operated under the name of Gazprom Germania,is a key company for energy supply in Germany“, specifies the ministry.
It counts municipal utilities among its customers and has a market share in Germany of around 20%. The group also owns numerous gas transport and storage infrastructures, including the largest reservoir in Europe located in Rehden (north-west). The German state had already taken control of the company in early April, against a backdrop of exacerbation of energy tensions between Russia and Western countries since the invasion of Ukraine. Sole shareholder of Gazprom Germania, Gazprom announced on April 1 that it had withdrawn its assets from its subsidiary.
Berlin had wanted to prevent the company from falling into hostile hands, or even being liquidated outright, and had entrusted its management to the Federal Network Agency (Bundesnetzagentur) for six months, renaming it SEFE. An accounting statement dating from the end of August indicates that SEFE has one billion in equity for 3 billion euros in debt, meaning that it is in a situation of over-indebtedness. “Business partners and banks have suspended business relationships with the company or are reluctant to enter into new ones“, indicated the Ministry of the Economy.
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To clean up the financial situation and clarify the ownership link, Berlin will carry out an accounting maneuver: the capital including reserves will be reduced initially to 0, causing the former Russian shareholder to lose control, subject to compensation which remains to be determined. In turn, Germany will inject 225 million euros into the company, becoming the “new sole shareholder“.
Germany also plans to increase a loan from the German public bank KfW to the company to 13.8 billion euros, in order to increase its equity via a debt-for-equity swap. These measures will be financed by the support plan of 200 billion euros decided at the beginning of October by Berlin to protect its economy in the face of the energy crisis and which has been criticized by several European countries.
Heavily dependent on Russian gas before the invasion of Ukraine, Germany was forced to find alternatives to these imports at the cost of a soaring energy bill.
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