The federal government has begun the process of potentially billion-dollar privatization of the state-owned gas company Sefe. The Ministry of Economic Affairs is seeking a tender for legal consulting services relating to the re-privatization of the company. Law firms can therefore apply until October 27th. Among other things, Sefe has the largest German gas storage facility. The company is also at the center of the current controversy surrounding Germany's gas storage facilities, which are sometimes barely filled. The federal government could earn billions through privatization. But many questions are still open. An overview:
What does Sefe do?
Securing Energy for Europe (Sefe) is one of the central players in supplying Germany with natural gas. Among other things, the company owns several gas storage facilities. The Sefe storage facility in Rheden in Lower Saxony alone accounts for 3.9 billion cubic meters, a fifth of Germany's total natural gas storage capacity. Sefe also operates several thousand kilometers of gas pipelines, including central parts of the German gas transmission network.
However, Sefe is not only an infrastructure operator, but also trades natural gas, electricity and CO2 certificates in Germany and internationally. Among other things, the company purchases gas from international suppliers via LNG and pipeline and sells it to 50,000 major customers, including industrial companies, power plants, municipalities, municipal utilities and other gas suppliers.
According to its own information, Sefe currently has 2,000 employees who generated sales of more than 15 billion euros and a profit of 289 million euros in 2025.
How did Sefe come into the possession of the covenant?
Until 2022, the company was a subsidiary of the Russian state-owned company Gazprom and operated under the name Gazprom Germania. After the Russian full-scale invasion of Ukraine, the sanctions against Russia and the Russian supply stop to Germany, the company got into trouble. Cut off from its main supplier, the Russian parent company Gazprom, it could only fulfill its delivery obligations in Germany if it procured gas on the world market at prices that had risen sharply at the time. At the same time, Gazprom transferred ownership to another Russian company and officially withdrew itself. Due to the risk that Gazprom would go bankrupt and cease to be a central player in German gas supply, the company was placed under trust management by the Federal Network Agency.
In November, the company, now renamed Sefe, was nationalized by the federal government. To do this, he increased the equity capital, which was negative due to the crisis, by several hundred million euros. There was also further money, including further government aid totaling more than six billion euros. According to reports, Sefe has already repaid around a billion of that.
Why should Sefe be privatized again?
From the beginning, the nationalization of Sefe was only planned as a temporary solution. The EU Commission's competition watchdogs only approved the billions in aid for the company on the condition that the federal government must return the majority to Sefe by the end of 2028 at the latest. The federal government may retain a maximum of a minority stake of 25 percent plus one share.
How should Sefe be privatized?
It has not yet been decided which path to choose for privatization. This is also evident from the current tender for legal advice. It is possible, for example, to sell all shares to one investor or to sell them step by step to several investors. Currently, consideration is being given to initially carrying out a capital increase through the entry of private investors. Additional shares could then be sold. An IPO is also not ruled out, although time is short. According to the tender, an individual sale of some parts of the company is also expressly possible.
How much money could privatization bring in?
As stated in the tender, the shares in Sefe are to be sold "at a price that is at least equal to the market value of Sefe". Sefe has valuable infrastructure with its storage facilities and pipelines and has been able to generate some high profits in recent years. However, these fluctuate considerably in view of the repeated energy crises. In addition, politicians are likely to want to continue to have a say in such a central player in the energy supply, especially if the federal government remains a minority shareholder in Sefe. This makes the company less attractive for investors. Reports recently put an estimate of the company's value at around six billion euros.
Does the proceeds of the sale go to Gazprom?
The federal government alone owns Sefe. He is entitled to all sales proceeds. If the first step towards privatization takes place through a capital increase with the help of investors, this money would be available to Sefe itself. The question of whether the federal government has to pay compensation for the nationalization of what was then Gazprom Germania has nothing to do with the sale. In principle, the state must pay compensation in the event of expropriation. However, the amount depends on the market value of the company at the time of nationalization and not on a later resale price. Since Gazprom Germania or Sefe was practically bankrupt and had to be rescued by the federal government with billions, the value at that time was probably zero.
