According to insiders, the German government may have to accept a significant discount on the share price when selling its shares in the nationalized energy group Uniper.

This does not reflect the actual value of the company, two people familiar with the matter told the news agency Reuters. At a current share price of 44.76 euros, Uniper would have a market capitalization of around 18.6 billion euros. The reason for this is the low free float of 0.88 percent. The share is hardly traded because the rest is held by the German state. Minority shareholders hoping for a high compensation payment from the federal government could also play a role. Uniper and the responsible Federal Ministry of Finance declined to comment.

According to insiders, the federal government could put 20 to 30 percent of Uniper shares on the market in spring 2025 to fill the empty budget coffers. The experts at Citi Bank had been commissioned as part of the process. For a successful partial sale, Uniper's value would have to be reduced to ten billion euros or even less, said an insider. This would put the share at 24 euros - a discount of 46 percent. Year-on-year, the share has already lost more than a quarter of its value.

The German government nationalized Uniper in 2022 and thus saved it from bankruptcy. Germany's largest gas company had got into difficulties due to the Russian gas supply freeze, as it had to buy expensive replacements for its customers at short notice. The value of the German government's 99.12 percent stake would currently amount to 18.5 billion euros. According to the EU Commission's requirements, the federal government must reduce its stake to at least 25 percent plus one share by the end of 2028.

Uniper CEO Michael Lewis admitted in February that there was little liquidity for the share, which could be improved by a larger sale of shares. According to the insiders, details such as the timing or size of the sale have not been finalized. One of the options is still to bring an anchor shareholder on board.

(Report by Christoph Steitz, edited by Tom Käckenhoff, edited by Ralf Banser. If you have any queries, please contact our editorial team at frankfurt.newsroom@thomsonreuters.com)

- by Christoph Steitz