Orsted down in Copenhagen after maxi-capital increase with 67% discount

(Il Sole 24 Ore Radiocor) - Orsted is down moderately after pricing its 60 billion kroner (over EUR8 billion) capital increase at a 66.7% discount to Friday's close. The Danish wind power big's share price has lost around 40 per cent since the start of the year and 85 per cent from the highs reached in January 2021.

Orsted set the price of the capital increase at 66.6 crowns per share, compared to 200.30 crowns on Friday. The subscription period starts on 19 September and will end on 2 October. The new shares are expected to start trading on 10 October. Orsted, which currently has 420 million shares issued, plans to issue a further 901 million shares as part of the increase. The Danish state, a 50.1% shareholder, will underwrite the recapitalisation and Norway's Equinor, which has a 10% shareholding, will contribute. "The share offer is fully underwritten in view of the Danish state's underwriting commitment and the underwriting agreement signed with a syndicate" of banks, Orsted points out. The transaction was launched to shore up the Danish group's financial situation in the face of difficulties, which are mainly coming from the United States due to the Trump administration's offensive against renewable energy, but also stem from supply chain problems, the delay of certain projects and interest rate developments. The most urgent needs concern the US projects Sunrise Wind and Revolution Wind.

"The proceeds from the capital increase will cover the immediate financing needs arising from maintaining full ownership of Sunrise Wind. The proceeds will also strengthen Orsted's capital structure and contribute to its financial resilience in the years 2025 to 2027, when Orsted will complete the construction of 8.1 GW of offshore wind projects, which will bring our installed offshore wind capacity to 18.3 GW," a group statement indicated. "Finally, the proceeds will help consolidate our position as one of the leading players in the offshore wind sector, as it will create a solid foundation for Orsted's value creation through potential investments in new offshore wind projects in our core markets in Europe, contributing to European energy independence," the note points out.

Two-thirds of the new funds are earmarked for Sunrise Wind, after the withdrawal of potential co-investors in the face of White House policies. Last month, US authorities also ordered the suspension of work on the nearly completed Revolution Wind project. The joint venture responsible for the project has filed a lawsuit against the administration. Meanwhile, news has rebounded from the US - reflecting Trump's aversion to green energy - that the Administration has asked a federal court to revoke the approval granted to an offshore wind farm planned off the Maryland coast. The $6 billion project, developed by US Wind, would install up to 114 turbines 10 nautical miles from Ocean City. The federal agency Boem claims that the initial approval underestimated the risks to rescue helicopters and fishing activities.