Germany nationalizes Uniper company, eight billion euros needed

(Patria) - The European Commission has allowed Germany to nationalize the major energy company Uniper, dpa reported.

For now, there are no legal obstacles indicating unfair competition, the Commission announced, which is giving the green light for the next steps.

The measures still need to be approved by Uniper shareholders at an extraordinary general meeting on Monday. It is now estimated that saving this company, vital for Germany, will cost the state more than 30 billion euros.

The package includes a recapitalization of eight billion euros and the purchase of Uniper shares. After that, the German government will own about 98.5 percent of Uniper shares.

Uniper ran into problems after Russia first reduced and then completely cut off gas supplies. Gas prices simultaneously increased manifold, and Uniper had to buy gas from other suppliers to fulfill contracts with the companies it supplied.

This wholesaler, which depended heavily on Russia, supplies more than 100 utility companies and large corporations, thus playing a central role in Germany's natural gas supply.

Uniper's bankruptcy would likely cause a domino effect, spilling over to customers. The nationalization of Uniper is intended to prevent such a scenario.