Energy company Fortum’s share price continued to fall on Monday after the opening of the Helsinki Stock Exchange. The stock fell about seven percent in afternoon trade.
The share of Fortum’s German subsidiary Uniper, meanwhile, was down more than nine percent on the Frankfurt stock exchange.
The share prices of the two companies fell on Friday after the content of Uniper’s rescue package was announced. On Friday, Fortum’s share fell by more than eight percent and Uniper’s by almost 30 percent.
Henri ParkkinenThe senior analyst of OP Finance Group sees the drop in shares as a reaction to the difference in the details of the rescue package from previous forecasts.
"The market had prior expectations regarding the structure of the package. Based on the reactions on Friday and Monday, the package contained surprising elements," Parkkinen commented to the news agency STT.
He added that there are still many issues and details that need clarification in the stabilization package.
"There are an awful lot of uncertainties that are not yet known. The company is starting to implement and promote the stabilization package. At the same time, it is difficult to predict the future of the gas market," said Parkkinen.
"The stock trends of both companies in recent weeks show that the market is reacting to the changes and the new issue," he said.
Fortum retains the majority
After the deal is completed, Fortum’s ownership in Uniper will decrease to 56 percent. Fortum, which is majority-owned by the state, currently has a 78 percent stake in the company.
On Friday, the Chancellor of Germany Olaf Scholz promised to protect Germans from rising energy costs after the government agreed a bailout for Uniper, which was threatened with bankruptcy due to market disruption caused by the war in Ukraine.
Plan "includes a capital increase of approximately EUR 267 million to a subscription price of EUR 1.70 per share"which leads "(the state’s) approximately 30 percent ownership in Uniper"Uniper said in a statement.
The company receives a public loan "up to 7.7 billion euros" in mandatory convertible bonds, which eventually become shares. The credit limit of the public lender will also be increased.
Source: The Nordic Page