Russia seizes Fortum subsidiary’s assets and replaces CEO
Russia seizes Fortum subsidiary’s assets and replaces CEO | Windpower Monthly
Earlier this week, Russia issued a presidential decree “which enables the authorities to introduce temporary asset management to assets owned by certain foreign entities in Russia,” Fortum said.
The Russian Federal Agency for State Property Management, Rosimushchestvo has been appointed as an interim asset manager of PAO.
Parent company Fortum, based in Finland, only learned of the development via a press release from the agency.
CEO Chuvayev replaced
PAO’s board of directors voted to replace the CEO Alexander Chuvayev, as instructed by Rosimushchestvo.
Once again Fortum was only made aware when the subsidiary issued a press release to that effect.
Fortum said it considers this appointment “to be confirmation that the new Presidential decree is being enacted and Fortum’s subsidiary has been put under temporary asset management.”
The new CEO Vyacheslav Kozhevnikov promised there would be “no changes to our operating activities,” Russian news agency Interfax reported.
Fortum said: “[Our] current understanding is that the new decree does not affect the title (registered ownership) of the assets and companies in Russia. However, it remains unclear how this affects Fortum’s Russian operations or the ongoing divestment process.”
Fortum is trying to divest its Russian assets and has halted all investments in the country in response to Russia’s full-scale invasion of Ukraine. The book value of its holdings in Russia was €1.7 billion as of 31 December 2022, the company said.
Strained relations
Fortum’s relationship with its subsidiary was already under considerable strain. The subsidiary successfully participated in Russia’s onshore wind auctions as part of a joint venture.
Fortum said last week that the subsidiary “independently made a decision…to participate in the auction. This decision is contrary to the clear instructions of Fortum Corporation and is not approved by the parent company.”