Fortum’s subsidiary Uniper takes precautionary financing measures including credit facilities from KfW Bank and Fortum to secure liquidity in extremely volatile markets
FORTUM CORPORATION INSIDE INFORMATION 4 JANUARY 2022 AT 21:15 EET
During the early winter season, the very volatile commodity markets with unprecedentedly high prices have resulted in significantly higher margining requirements for European market participants. Fortum’s subsidiary Uniper is hedging its asset positions with forward commodity sales, which are often subject to margining payments. When commodity prices increase, the mark-to-market value of those deals decline, which triggers additional margining payments for Uniper. When the underlying gas and power positions go into delivery or commodity prices decline, the margining payments are returned to Uniper.
To manage any further market volatility and significant price increases, Uniper has taken precautionary measures to secure additional liquidity and financial flexibility primarily for the winter season:
- Fortum has provided Uniper with intra-group financing in the format of a credit facility agreement of up to EUR 8 billion on arm’s length terms. This credit facility comprises two tranches: shareholder loan and parent company guarantee. To date, Uniper has used part of the facility.
- Uniper has drawn the company’s existing EUR 1.8 billion revolving credit facility in full.
- Uniper has agreed with the German state-owned KfW-Bank on a short term revolving credit facility of up to EUR 2 billion. The facility has not been used so far.
During 2021, the European gas prices have risen up to 1,000% and have, together with power prices, been at unprecedented levels in December. Under these market conditions, Uniper's focus remains on securing reliable deliveries to its customers and honouring its commitments.
Uniper has today published a corporate release (‘ad hoc’) on the matter. This release can be found on Uniper’s website.
Fortum Corporation
Ingela Ulfves, VP, IR and Financial Communications
Additional information
Investor and analysts:
Ingela Ulfves, VP, IR and Financial Communications, tel. +358 40 5151 531
Rauno Tiihonen, IR Manager, tel. +358 10 453 6150
Media:
Fortum News Desk, tel. +358 40 198 2843
About Fortum and Uniper
Fortum and Uniper form a European energy group committed to enabling a successful transition to carbon neutrality for everyone. Our 50 gigawatts of power generating capacity, substantial gas import and storage operations, and our global energy trading business enable us to provide Europe and other regions with a reliable supply of low-carbon energy. We are already Europe’s third largest producer of CO2-free electricity, and our growth businesses focus on clean power, low-carbon energy, and the infrastructure for tomorrow’s hydrogen economy. In addition, we design solutions that help companies and cities reduce their environmental footprint. Our 20,000 professionals and operations in 40 countries give us the skills, resources, and reach to empower the energy evolution toward a cleaner world. fortum.com; uniper.energy
