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The European Commission has approved a German fund of €225.6m to support SEFE Securing Energy for Europe (SEFE GmbH), previously Gazprom Germania GmbH, allowing German authorities to take over the company.
The move comes days after Gazprom withdrew from its energy trading, storage, and transmission business, Gazprom Germania, because of strained energy ties between Russia and Germany following the invasion of Ukraine.
The new measure will allow Germany to take a 100% stake in SEFE GmbH, substituting Gazprom Export LCC, which is a majority state-owned Russian company.
SEFE has a 14% share in the German gas supplies market and owns and operates 28% of the gas storage serving the German market. It also owns gas pipelines in Germany and other member states.
To continue business relations with market participants, Germany intends to take SEFE’s full ownership.
As part of this plan, the existing registered capital of €225.6m will be set to zero, thus ending the ownership of current Russian shareholders.
New ordinary shares will then be issued by SEFE to the same amount that will be subscribed by Germany.
Following assessment, the commission determined that the German measure is ‘necessary, appropriate, and proportionate’ to offset the country’s ‘serious disturbance in the economy’.
In a press statement, the commission said: “The approval is subject to Germany’s compliance to conditions to limit potential distortions of competition, namely an acquisition ban and a bonus ban.”
Germany also agreed to a long-term viability assessment for SEFE GmbH and its subsidiaries for the commission. This will cover the notified measure and potential recapitalisation measures.
European Commission executive vice-president in charge of competition policy Margrethe Vestager said: “So, we welcome the change of ownership of SEFE, which will enable Germany to search for new gas suppliers while ensuring security of supply.”