Breaking up Uniper risks 'open conflict', Germany's Verdi union says - Reuters.com

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The Uniper logo is seen in front of the utility's firm headquarters in Duesseldorf, Germany, July 8, 2022. REUTERS/Wolfgang Rattay

DUESSELDORF, Germany, July 11 (Reuters) - German union Verdi on Monday warned against breaking up utility company Uniper (UN01.DE) and said its Finnish parent Fortum (FORTUM.HE) risked "open conflict" with the union if it tried to do so.

Germany's biggest gas importer, Uniper last week asked the German government for a bailout as it faced losing 10 billion euros ($10.08 billion) due to soaring prices and dwindling supplies in an economic standoff between the West and Russia.

While Germany's government expects Fortum to contribute to the rescue, Fortum has proposed ringfencing Uniper's German business under government ownership, saying it had already given Uniper billions in loans and guarantees.

"If Fortum wants to push through its proposal, there will be an open conflict with us," Christoph Schmitz, a member of Verdi's board, told Reuters in an interview, adding that Fortum's proposal would amount to a break-up of Uniper.

"We strictly reject this," he said, as it would mean "all 5,000 jobs in Germany would be threatened".

A German economy ministry spokesperson on Monday said the bailout talks for Uniper were not easy but the government hoped to announce a solution soon.

Uniper is one of Germany's largest energy companies and employs around 11,500 people worldwide. The company should be kept intact, Schmitz said, though he said Verdi was prepared for some restructuring.

He added that the union would welcome the German government taking a stake in Uniper, as Berlin had done to rescue the Lufthansa airline during the pandemic.

Ukraine and its allies accuse Moscow of using spurious pretexts to strangle gas flows in retaliation for sanctions over the invasion of Ukraine. The Kremlin denies any such manipulation of gas flows or using energy as a political weapon.

($1 = 0.9922 euros)

Writing by Matthias Williams; editing by Barbara Lewis

Our Standards: The Thomson Reuters Trust Principles.

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