In the spring of 2020, everything was still fine in the world of gas, at least that’s how it seemed to the outside world. It all started with the business model: gas was procured cheaply from Russia and then passed on to the market with a good cut. And dealers like the Düsseldorf importer Uniper made a lot of money with it. Many probably thought that this would go on forever. Okay, Russia’s warlord Vladimir Putin had annexed Crimea a few years earlier and had political opponents poisoned. But Russia was far away. Who has lived in Crimea, who has had to risk their life as a Putin critic? And besides, the gas comes from the pipeline, doesn’t it? Uniper, which was only spun off from the energy group Eon in 2016, seemed a safe bank. Especially if you hide the trappings.
That’s probably how the then boss of the Finnish energy company Fortum, Pekka Lundmark, saw it. He found the German business model so convincing that he bought Uniper for billions in spring 2020 – at the end of a bitter takeover battle, the Finns held almost 80 percent of the company, which in turn is controlled by the government in Helsinki. In that sense, Uniper became quite Finnish a few years ago.
Are these really other people’s problems?
But now you have huge problems because of Russia’s war of aggression and lose millions of euros a day. But the problems should now be solved by others – above all the German state and thus the taxpayers. And the Finns? They find it very important that Uniper is supported. But please no more of them, Fortum has already invested a lot of money in Germany. Help German gas customers with Finnish money? Aren’t those other people’s problems?
No they are not. First buy for billions and then just want to pass on the burden – that’s problematic. Owners bear responsibility, whether they come from Germany or Finland.
The business model is dead
The fact that Germany has become increasingly dependent on Russian gas over the years also has a lot to do with Uniper’s business model. A model that ended at the latest with the Ukraine war. Gas has become an expensive and scarce commodity overnight and may soon run out altogether. Because of the cut supplies from Russia, Uniper has to see where it is now getting its gas from in order to meet its delivery obligations. Something like that costs extra, and not too little. That is why Uniper now needs state aid and is waiting for the federal government to get involved.
The fact that German taxpayers are now having to pay for this failed strategy is tragic, but probably unavoidable: if the ailing company were to crash into a wall, the risks would be incalculable. But without the Finnish main shareholders? Fortum has lived well with Uniper, the Finnish state in turn has benefited from Fortum – this is how the economy works in good times, but also in bad. So if Finns and Germans are fighting to save Uniper these days, then in the end both sides will have to find a responsible solution. It was Economics Minister Robert Habeck (Greens) who called for European solidarity in the energy supply these days. The Uniper case is a first major test: How far along is solidarity among Europeans?
“Goes well with Fortum”
At the time, Lundmark sent one of those classic managerial eulogies to the Rhineland: “Uniper is a successful, international energy supplier and trader and is an excellent match for Fortum.” Fits or no longer fits? To put it mildly: the situation is already extremely ugly. And it would be even more ugly if Fortum made a slim foot here.