Energy giant Uniper, which runs seven UK power stations, may be bailed out by the German government as part of its efforts to avoid a collapse of the country's energy system.
Shares of Uniper fell by more than 16% on Wednesday after the company said it was looking at bailout alternatives with the German government.
Berlin may increase its stake in the company, the company confirmed, with reports suggesting that it may rise above 50% and could even see a full nationalisation of what is the country's largest gas importer.
The Düsseldorf-based group still needs more government assistance after already tapping into a support package worth US$20bn.
The government intervened in July with a rescue package including a 30% stake as a result of a surge in natural-gas prices and Russian supply cuts, due to which Uniper expects to post huge losses in 2022.
Uniper had earlier borrowed €2bn amid bailout negotiations.
Reports indicate a possibility that Chancellor Olaf Scholz's administration will increase its stake above the 50% threshold and inject more capital.
There are also discussions about Uniper's full nationalisation, and its Finnish parent company Fortum Oyj would be involved.
Fortum's majority owner, the Finnish government, is in talks with Germany, which has previously stated that it would not be interested in buying out the Finnish stake.
Uniper confirmed one of the options being discussed is for the German government to take a "significant majority" stake.
Fortum issued a statement saying no decisions have been made "beyond what was agreed in the stabilisation package in July" but added "alternative solutions" are under consideration.
Fortum, the German government and Uniper will continue to discuss a long-term solution while the deteriorating operating environment and Uniper's financial situation are taken into account, Fortum said, adding it would "update the market as and when necessary."