German utility E.ON may have to re-assess its valuation of its new spin-off business, Uniper.

The company may book writedowns related to the newly formed power plant and energy trading unit it plans to spin off in September, a spokesman said, in what could potentially trigger the utility’s third net loss in as many years.
E.ON building
“We have already made clear at our capital markets day in April that Uniper will be recognised in our books according to its market value and that there might be a need to correct its value,” a spokesman for E.ON, Germany‘s largest utility, said.

Reuters reports an E.ON spokesman as saying Uniper, which owns gas, coal and hydropower plants, had to be valued according to its market price following the listing, which analysts reckon will give the unit a market capitalisation of about EUR5bn ($5.57bn).

This would be much lower than the EUR15.5bn ($17.2bn) net book value for Uniper E.ON cited in its spin-off report in April, increasing the risk of billions of euros of writedowns and a potential net loss, German business daily Handelsblatt reported.

[bc_video account_id=”1214147015″ player_id=”4697982639001″ video_id=”5068338261001″ min_width=”320px”]