Russia Seizes Assets of Two European Energy Companies as G-7 Mulls Tougher Sanctions

Russia seized control of the assets of two more European state-owned energy companies, amid reports that G-7 nations are planning to impose a near-total ban on exports to Russia.

The Russian assets seized belong to Finnish energy group Fortum and its former German subsidiary Uniper.

Russian President Vladimir Putin signed the decree legalizing the takeover of control over the assets. Uniper and the German finance ministry did not offer any immediate comment, while Fortum said it was investigating the matter, according to Reuters.

Uniper German gas giant
Uniper Germany Reuters

"The decree does not concern ownership issues and does not deprive owners of their assets. External management is temporary in nature and means the original owner no longer has the right to make management decisions," said Rosimushchestvo, the federal government property agency.

How Large are Fortum and Uniper in Russia?

The Finnish company's Russia operates seven thermal power plants in Ural and Siberia. Its book value is pegged at $1.87 billion as of the end of 2022. Fortum also runs wind and solar plants in Russia.

"Fortum's current understanding is that the new decree does not affect the title (registered ownership) of the assets and companies in Russia ... However, it remains unclear how this affects e.g. Fortum's Russian operations or the ongoing divestment process," the company said.

German company Uniper holds 83.73 percent in Unipro, which has as many as 4,300 employees in Russia and owns several power plants in the country.

Rosneft YouTube grab

In September last year, Germany raised the stakes in its clash with Russia by seizing the German unit of Russian oil giant Rosneft. In the audacious move that worsened bilateral ties, Berlin took over the assets of Rosneft, including its stake in three oil refineries. The German government's action was in the backdrop of the 'threat to the security of energy supply' German economy ministry said.