Fortum logo. Stock photo: Fortum on LinkedIn
Finnish energy company Fortum has filed a lawsuit in a Dutch civil court against Russia’s Forward Energo (formerly PAO Fortum).
Source: Fortum
Details: The lawsuit concerns intercompany loans amounting to approximately €600 million, which PAO Forward Energo has failed to repay. Most of these loans have reached their maturity date, and no payments have been made. In addition, PAO Forward Energo has defaulted on the interest payments for all the loans.
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The total claim, including interest and default interest, amounts to around €800 million. The final amount will depend on the RUB/EUR exchange rate and the total accrued interest.
Fortum expects the legal proceedings to last several years.
According to the initial loan agreements, disputes between the parties are to be settled in Dutch courts and according to Dutch law.
The company involved in the lawsuit was formerly owned by Fortum but was placed under temporary management by decree of Russian Leader Vladimir Putin in 2023, transferring it to the Federal Agency for State Property Management. Afterward, the company changed its name to PAO Forward Energo.
PAO Forward Energo/Fortum is one of the largest producers and suppliers of thermal and electric energy in the Ural and Western Siberia regions. It operates seven thermal power plants in Chelyabinsk and Tyumen oblasts, as well as several renewable energy facilities in other parts of Russia.
Background:
Following the modification of rules concerning the sale of foreign-owned businesses in Russia, previous owners can only receive 5% of the market value of their assets.
The Russian government has stated it will block any attempts by companies such as Raiffeisen Bank International AG and UniCredit SpA to sell their local subsidiaries to buyers who could be subject to sanctions.
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