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Helsinki, March 13 (Reuters) - Energy company Fortum said on Friday it had met all regulatory conditions to take a majority stake in German rival Uniper, after receiving a final approval from Russian authorities.
The decision means Fortum can obtain up to a 73.3% ownership in the German energy group and gain control of the company, ending a more than two-year takeover battle.
“We are pleased to have completed the final regulatory step and can now move forward with the closing of our transactions,” Fortum’s outgoing Chief Executive Pekka Lundmark said in a statement.
State-controlled Fortum has been seeking control of the energy firm since 2017, but Uniper’s top management initially opposed a full takeover.
In October last year, Fortum agreed to pay around 2.3 billion euros ($2.5 billion) to acquire the stakes of activist funds Elliott and Knight Vinke to end the long-running deadlock over ownership of the group.
Up until Friday, the deal with the activist funds was held back by Russian regulators capping Fortum’s ownership in Uniper at 49.99% due to a strategic water licence operated by the German firm’s local subsidiary Unipro.
“The Russian Federal Antimonopoly Service has today informed Fortum that the company does not need a merger clearance decision for closing its majority transactions on Uniper SE shares,” Fortum said in a statement.
Fortum has committed to not pursue a “domination agreement”, profit and loss transfer agreement or squeeze-out of minority shareholders until Sept 2021, limiting its ability to control Uniper directly.
Earlier on Friday, Fortum called Uniper’s new strategy a step in the right direction but called for more emission cuts in Russia.
Fortum said it would first obtain at least an additional 19.6% of Uniper shares by the end of the first quarter and then between 1% and 3.8% in another tranche within two months of the first closing, bringing its total shareholding to between 70.5 and 73.3% from current 49.9%.
Fortum said it would consolidate Uniper as a subsidiary in its financial reporting as of the first tranche closing date.
Reporting by Anne Kauranen. Editing by Jane Merriman