May 20, 2019 / 12:36 PM / 5 months ago

UPDATE 1-Fortum must shoot down activist proposals for Uniper - union

* Elliott, Knight Vinke have put forward motions at Uniper AGM

* Fortum will share view once it is ready - spokeswoman

* Uniper’s AGM scheduled for May 22 (Recasts with labour leader comments, context)

DUESSELDORF, Germany/HELSINKI, May 20 (Reuters) - Finland’s Fortum, Uniper’s top investor, must show its cards before the German energy firm holds its shareholder meeting this week and shoot down activist proposals, some of which could trigger the group’s breakup, a labour leader said.

The fate of Uniper, which was spun off from E.ON in 2016, has been hanging in the balance ever since Fortum bought a 49.99% stake against Uniper’s will, barred from owning more unless Uniper sells a water-testing license in Russia.

To break the deadlock, No.2 shareholder Elliott has put forward a motion at Uniper’s annual shareholder meeting, scheduled for May 22, that would prompt management to enter talks with Fortum over a so-called domination agreement.

Third-largest investor Knight Vinke has separately asked investors to vote on a proposal to spin off Uniper’s Russian unit Unipro by splitting off the International Power business or consider a legal separation of its hydroelectric and nuclear power generation assets in Sweden.

“The workers at Uniper are concerned. It is very difficult if the new shareholder leaves open how it will vote at the annual general meeting,” Andreas Scheidt, a member of the national executive board of German union Verdi, told Reuters on Monday.

“I expect that Fortum will take responsibility and dismiss the motions by Elliott and Knight Vinke,” Scheidt, who also serves as deputy chairman of the supervisory board at E.ON, said.

Uniper has rejected the proposals brought forward by Knight Vinke but has made a recommendation with regard to Elliott’s demand, only saying it would have far-reaching implications for Fortum without being more specific.

Fortum, whose vote could sway any outcome, has so far remained silent on the matter.

“We appreciate that there is concern and uncertainty among employees following the motions by other shareholders,” a spokeswoman for Fortum said.

“It is not our intention to increase concern by any unnecessary delays. People can rest assured that we will state our position as soon as we are ready.” (Reporting by Tom Kaeckenhoff and Tarmo Virki; Writing by Christoph Steitz; Editing by Riham Alkousaa and Michelle Martin)

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