On Tuesday, Russian President Vladimir Putin signed a decree that puts under Moscow control the Russian assets of the Russian power plant operator Fortum and the German company Uniper. At the same time, they state that the move is reversible.
Unipro said it would review the action against Unipro’s Russian division. Germany’s Finance Ministry, which oversees state-owned Uniper, said Berlin needed to assess the specific effects of the Russian system.
Fortum is conducting an investigation and has learned from its Russian subsidiary that the company’s CEO has been replaced and the unit has been placed under temporary asset management. Finland’s Minister of State Property Titi Toupurenen tweeted that the information was concerning and that the state, as the majority owner of Fortum, was watching the matter closely.
We wrote earlier that Wintershall Dea, which still owns shares in joint ventures with Gazprom in Russia, called Moscow’s policy unpredictable and unreliable. In addition, the German energy giant will not help rebuild Nord Stream and will withdraw from Russia.
Putin targets the West’s economy
Moscow has reacted angrily to reports that G7 countries are considering imposing a near-total ban on exports to Russia, with many calling for tougher sanctions to weaken Russia’s ability to fight in Ukraine.
Meanwhile, the EU will use the frozen Russian assets to rebuild Ukraine. Last year, Germany nationalized a former division of Russian energy giant Gazprom.
The adopted decree is a response to the aggressive actions of unfriendly countries
Kremlin spokesman Dmitry Peskov said. He added that this initiative reflects the attitude of Western governments towards the foreign assets of Russian companies.
Regarding Putin’s decree, he said that it does not deal with issues of property rights and does not deprive owners of their property. Peskov explained that external management is temporary and only means that the original owner no longer has the right to make management decisions.
Escape is hard
She explained that the Finnish Foreign Ministry does not want to comment on how Russia’s decision will affect relations between the two countries. Reuters.
Both companies are trying to withdraw from Russia. In February, Uniper valued its stake in Unipro at a symbolic €1, indicating that the deal may not be completed.
External control over assets of outstanding importance for the stable operation of the Russian energy sector has been introduced, and the list can be expanded
– said Peskov. The shares of the two organizations were temporarily placed under the control of Roszimuschestvo, the federal state property agency.
New CEOs were appointed, Vasily Nikonov at the helm of Unipro and Vyacheslav Kozhevnyikov at Fortum in Russia, the two men transferred from Russian oil companies at Rosymuschestvo’s request.
Russia’s state-owned bank VTB said this week that Russia should consider seizing and managing assets of foreign companies such as Fortum and returning them only after sanctions are lifted. Fortum has previously indicated the risk of forfeiture.
Asset sales by investors from “unfriendly” countries, as Moscow calls those that have imposed sanctions on Russia, require the approval of a government committee and, in some cases, the president.
Moscow’s move creates yet another headache for companies trying to get out of Russia. Companies with stakes in energy projects and banks are already facing tougher exit options.
Western energy companies have been targeted
Uniper owns 83.73% of Unipro, which operates five power plants in Russia with a total capacity of more than 11 GW and about 4,300 employees.
The Russian division of the other controlled company, Fortum, owns seven thermal power plants in the Urals region and western Siberia, as well as a group of wind and solar power plants in Russia with local partners.
The book value of these assets at the end of 2022 was 1.7 billion euros ($1.87 billion). Fortum is majority owned by Finland, which joined the NATO military alliance earlier this month in what Moscow called a serious mistake.
(Cover photo: Vladimir Putin on April 27, 2023. Photo:
Sputnik/Mikhail Klementev/The Kremlin/Reuters)
This was answered by Barnabas Viraj, Vice President of MNB and Tibor Toth, State Secretary of the Ministry of Finance, as well as many high-level financial experts at the Napi.Gazdaság conference. Learn more about the conference!
