Germany nationalises ex-Gazprom subsidiary

Berlin is set to purchase 100% shares of a former Gazprom subsidiary, SEFE Securing Energy for Europe GmbH, previously known as Gazprom Germania, Reuters reports.

Germany is planning to buy out the company to rescue it from a bankruptcy, the agency adds.

“The step was necessary to ensure the nation’s energy supply, the ministry said, with Sefe threatened by insolvency after a plunge in Russian imports inflicted billions of euros in losses on it as the company and other gas importers turned to the expensive spot market to source gas elsewhere,” Reuters notes.

Barron’s writes that the company’s losses will be offset by capital reserves through accounting manoeuvres, while Gazprom will lose its investment in the company. Berlin will then invest €225 million, becoming the sole shareholder.

The European Commission earlier greenlit nationalisations of Gazprom subsidiaries, allocating €225.6 million to purchase all shares of the company.

The SEFE GmbH energy company holds 14% of the German gas supply market and also operates in other EU states. It owns and manages 28% of gas reservoirs that serve the German market as well as gas pipelines in Germany and other EU members.

On 4 April, SEFE GmbH was placed under the supervision of Germany until 15 December amid an attempt to transfer shares and liquidation by the Russian shareholder. Germany aims to become the only owner of the company so that it can continue its business relations with market platers and serving its clients.