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BERLIN, Nov. 14 (AP) Germany said on Monday it was nationalizing Gazprom’s former German subsidiary, months after it was controlled by government agencies, marking its own The latest nationalization of the energy sector since the Ukrainian war.
The government cited the debt load of the company, which has changed its name to Securing Energy for Europe, and said it was taking action to avoid the danger of bankruptcy and ensure its operations continued.​​​
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SEFE, which trades, transports and stores natural gas in Germany and neighbouring countries, is a “key company for Germany’s energy supply,” the economy ministry said. Germany has the largest economy in Europe.
As European countries backed Ukraine, Russia cut the flow of natural gas for heating, power generation and the power industry, causing an energy crisis, fueling inflation and forcing some factories to close as prices rose. Germany, a major importer of Russian gas before the war, has not received any gas from Russia since the end of August.
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The government put Germany’s cyber regulator in charge of what was then Gazprom Germania in early April after the former parent company took an opaque move to cut ties to the department. The regulator is appointed as the company’s trustee with the power to dismiss and appoint managers.
The company was subsequently sanctioned by Russia for its tit-for-tat response to Western sanctions on Ukraine.
The German economy ministry said the Russian sanctions had left the company in financial distress, with business partners and banks either ending ties with it or refusing to establish new ones due to unclear ownership.
SEFE has secured 11.8 billion euros ($12.2 billion) in government loans to stabilize the company. It has now increased to 13.8 billion euros.
The government is taking over SEFE with capital cuts, eliminating previous shareholders and injecting new capital of around 225.6 million euros under the umbrella of a government-controlled company.
This is the latest nationalization of the energy sector in Germany. In September, the government said German authorities were taking control of three Russian-owned refineries to ensure energy security. Two subsidiaries of Russian oil giant Rosneft have been placed under the control of the state cyber watchdog.
Soon after, the government announced the nationalization of Uniper, the country’s largest gas importer. The company’s losses increased as Russia cut gas supplies. (Associated Press)
(This is an unedited and auto-generated story from the Syndicated News feed, the body of the content may not have been modified or edited by LatestLY staff)
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