Fortum Investigates News of Russian Asset Seizures

By Dominic Chopping

Finnish energy group Fortum Oyj said Wednesday that it is investigating the impact on its Russian operations of a presidential decree that has enabled authorities in the country to introduce temporary management of assets owned by certain foreign entities, including Fortum subsidiary PAO Fortum.

The company said that according to a press release, the Russian Federal Agency for State Property Management has been appointed as an interim asset manager, giving it ownership powers.

"Fortum's current understanding is that the new decree does not affect the title (registered ownership) of the assets and companies in Russia," it said.

"However, it remains unclear how this affects e.g. Fortum's Russian operations or the ongoing divestment process."

Fortum said last year that it had stopped all new investment projects in Russia and wasn't providing any new financing to its Russian subsidiaries following the country's invasion of Ukraine.

Fortum's Russia division has seven thermal power plants in the country and together with joint-venture partners has a portfolio of 3.4 gigawatts of wind and solar plants.

It is in the process of implementing a controlled exit from the Russian market, with potential divestments of its Russian operations as the preferred path.

The book value of Fortum's holdings in Russia was 1.7 billion euros ($1.87 billion) as of Dec. 31.

"At this point Fortum has not received official confirmation from the Russian authorities and the company is currently investigating the situation," it said.

Write to Dominic Chopping at dominic.chopping@wsj.com

(END) Dow Jones Newswires

April 26, 2023 03:49 ET (07:49 GMT)

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