Fortum may have to increase its price for Uniper; deal seen as risky – report (translated)
18 OCT 2017
The Finnish energy company Fortum [HEL: FORTUM], may have to raise its bid for Uniper [ETR: UN01], the German energy group, in order to get a majority, according to Kauppalehti Online.
The Finnish-language piece cited a report from the Swedish Bank Handelsbanken, and wrote that the bank views the deal skeptically and notes in its recent report that the deal is either a poor financial investment or very risky.
Handelsbanken points out that Uniper's share continues to trade above Fortum's 22 euro cash offer, and is currently at about EUR 24. According to the bank, this could mean that in order to obtain the entire company, Fortum may later raise its bid, which would increase Uniper's corporate value to more than EUR 12bn.
In turn, Fortum may require a share issue in order to secure funding. According to Handelsbanken, the deal contains too many unknown variables. Fortum's share has risen by approximately 8% after the release of Uniper. By the beginning of the year, the share has strengthened by 22%.
Kauppalehti is a Finnish business daily, which is behind a paywall.