Denmark-based offshore wind power developer \u00d8rsted has announced a DKr60bn ($9.3bn) rights issue to enhance its capital structure and offer financial flexibility, ensuring adequate capitalisation from 2025 to 2027.<\/p>\n
The rights issue was announced following the recent significant adverse development in the US offshore wind market.<\/p>\n
As a result, the company is unable to proceed with the planned partial divestment and the associated non-recourse project financing for its Sunrise Wind offshore project.<\/p>\n
This situation is preventing the company from achieving the necessary enhancement of its capital structure to support its investment programme and business plan.<\/p>\n
\u00d8rsted now faces an incremental funding requirement of DKr40bn, as it needs to finance the construction of the entire project from its balance sheet without external financing.<\/p>\n
The funds from this capital raise will support \u00d8rsted’s financial position as it aims to deliver an 8.1GW construction portfolio by 2027.<\/p>\n
Existing shareholders will have the pre-emptive right to subscribe for their respective pro rata share of the capital increase in the rights issue, thereby allowing them to maintain their current relative ownership stake.<\/p>\n
The Danish state has committed to subscribing for its pro rata share of 50.1% in the rights issue, while Morgan Stanley stands as the underwriter, ensuring full subscription.<\/p>\n
\u00d8rsted chair of the board of directors Lene Skole stated: \u201cGiven the unprecedented regulatory development in the US, we have made a comprehensive assessment of all options, and \u00d8rsted\u2019s board of directors has concluded that the planned rights issue is the best path forward for the company and its stakeholders.<\/p>\n
\u201cThe rights issue will strengthen \u00d8rsted\u2019s capital structure and provide financial robustness in the years 2025 through 2027, during which we\u2019ll deliver on our 8.1GW offshore wind construction portfolio. This will be the foundation for generating long-term value from \u00d8rsted\u2019s platform and capabilities, for the benefit of our shareholders and other stakeholders.\u201d<\/p>\n
The rights issue is designed to cover additional funding needs and to allow more flexibility in partnership timings and divestments related to other offshore wind farms.<\/p>\n
It enables \u00d8rsted to maintain its competitive edge and pursue profitable investments in offshore wind farm markets within Europe and select markets in the Asia Pacific region.<\/p>\n
Alongside this development, \u00d8rsted is continuing with efforts towards farm-down processes at the Changhua 2 and Hornsea 3 offshore wind farms and is considering divesting its European onshore business.<\/p>\n
This move can potentially raise more than DKr35bn in proceeds in 2025\/26.<\/p>\n
An extraordinary general meeting is scheduled for September 2025, where shareholders will vote on authorising this rights issue.<\/p>\n
\u00d8rsted group president and CEO Rasmus Errboe stated: \u201cTo deliver on our business plan and commitments in this environment, we\u2019ve concluded that a rights issue is the best solution for \u00d8rsted and our shareholders. The rights issue will reinforce our ability to realise the full value potential of our existing portfolio and capture future value-creating opportunities in offshore wind.<\/p>\n
\u201cAt a critical time when we\u2019re constructing 8.1GW of offshore wind capacity and making good progress across our entire construction portfolio, the rights issue will ensure a capital structure which supports a solid investment-grade credit rating and a more robust \u00d8rsted.\u201d<\/p>\n
Lazard Fr\u00e8res and Morgan Stanley & Co International are serving as financial advisors to \u00d8rsted and its board of directors.<\/p>\n