Osted, 9.4 billion capital increase at a 67% discount
On the Copenhagen Stock Exchange, the share price drops almost 4 per cent, after losing a third of its value at the capitalisation announcement last week
by Mo.D.
2' min read
2' min read
Strong discount for Orsted's $9.4 billion capital increase. The Danish wind energy group announced the issue of new shares at a 67% discount to Friday's closing. The recapitalisation is the largest for a European energy group in a decade and is essential to ensure the company's business continuity as it seeks to complete two major offshore projects in the US despite strong opposition from the Trump administration.
In yesterday's early session, a sharp initial slide was followed by a rebound, suggesting a relatively muted market reaction compared to the stock's volatility in recent weeks. The stock's year-to-date balance is negative by more than 41%.
The terms of the transaction
.According to the prospectus published yesterday, the new shares will be issued at DKK 66.6, compared to DKK 200.3 at the close on Friday, 11 September. The subscription price implies a discount of 67% to the stock exchange value and 39% to the theoretical ex-rights price.
Analysts at Citigroup pointed out that the discount offered is larger than recent capital increases in the utilities sector. "It is a significant discount, but one that is justified by uncertainties over US projects and the impact of tariffs," commented Jacob Pedersen, head of equity analysis at Sydbank.
The Commitment of Major Shareholders
.The decision to go ahead with the increase came as a result of the inability to divest a stake in the Sunrise Wind wind farm off New York due to pressure from the Trump administration against offshore wind. Orsted therefore chose to address its shareholders directly.
