Fortum theoretically retains possibility to sell assets in Russia; change in management complicates the process - CEO

MOSCOW. May 11 (Interfax) - Finland's Fortum energy concern theoretically still retains the possibility of selling its assets in Russia, company CEO Markus Rauramo said during a conference call with investors.

However, the change in management at the Russian assets complicates the process, Rauramo said.

The Russian president issued a decree at the end of April to introduce temporary management of Fortum's and Uniper's Russian assets. The decree applies to 83.73% of shares in PJSC Unipro and 98.23% of shares in PJSC Fortum . The Federal Property Agency was designated the temporary manager.

The Property Agency said the decree did not affect ownership issues and did not deprive the owners of their assets.

The day after the decree came out, the boards of directors of PJSC Fortum and Unipro changed their general directors, in accordance with the Property Agency's requirements. Vyacheslav Kozhevnikov of Bashneft (MOEX: Bashneft) was named as head of Fortum.

Fortum has decided following a review of results for Q1 2023 to fully write down its Russian assets and deconsolidate them in its financial statements.

The company said in a report that it had "consistently sought an exit from the Russian market since last spring and applied for permission to sell the operations to both Russian and international buyers without success."

Fortum, one of the largest foreign investors in Russia's electricity sector, owns 98.23% of PJSC Fortum and about 30% of PJSC TGC-1 , the principal shareholder of which is Gazprom Energoholding (GEH). The Finnish company was also one of the largest investors in Russian wind power.