Economy

Fortum launches $9.5B bid for Uniper after securing E.ON stake

Fortum launches $9.5B bid for Uniper after securing E.ON stake”

Finnish power utility Fortum is to launch an €8 billion (£7bn) takeover offer for E.ON's Uniper.

Fortum said it signed a deal with E.ON to acquire about 46 percent share of Uniper stock.

The benchmark DAX was up 60 points or 0.49 percent at 12,666 in late opening deals after rising 0.1 percent on Tuesday.

Germany's second largest energy company has been seeking a buyer for its Uniper stake ever since it spun off its traditional gas- and coal-fired power stations in 2016.

Uniper operates around 38 gigawatts of power plants in Europe and Russian Federation and had sales of around 67 billion euros in 2016, compared with Fortum's revenue of 3.6 billion euros the same year.

The agreement also includes a clause that if E.ON does not tender its stake, then the Finnish firm will be entitled to divest any shares of Uniper it had purchased in connection with the bigger takeover offer to the German firm. "We are totally satisfied with the E.ON stake, we are not targeting a control or a merger".

Lundmark regretted that he didn't have time to discuss with Uniper before media reports on the deal forced Fortum and E.ON to go public with it last week.

Last week, Uniper had rejected Fortum's takeover offer, terming it as unsolicited with its CEO Klaus Schäfer stating that it did not align with the company's strategy.

"I understand him (Schaefer) very well".

"We are not hostile at all".

Lundmark said Fortum is not planning to conquer Uniper.

Uniper published a press release after the news, saying its management board would analyse and assess the offer.

However, based on their offer to all shareholders, the ownership by Fortum may exceed 50 percent of Uniper.

State-controlled Fortum is focused on carbon-free power generation, mainly in the Nordic region and Russian Federation, and has been looking for a deal since selling its power distribution grids for 9.3 billion euros in 2014 and 2015.



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