Orsted, the world’s largest offshore wind developer, has agreed to sell a 50% stake in Britain’s Hornsea 3 offshore wind farm to Apollo Global Management for 39 billion Danish crowns ($6.09 billion). This move is seen as crucial for the Danish company to stabilise its financial position and prevent a potential credit rating downgrade. Orsted is a renewable energy company that develops, constructs, and operates offshore and onshore wind farms, solar farms, energy storage facilities, and bioenergy plants. It aims to create a world that runs entirely on green energy.
The sale of the stake in the 8.5 billion pound ($11.41 billion) project to Apollo Global Management, which manages over $800 billion in assets, will leave Orsted with a 50% ownership share. The company has been facing increased financial pressures due to rising costs from supply chain disruptions and inflation, as well as uncertainty in the renewable energy sector. Orsted seeks to restore investor confidence through this transaction.
According to Orsted, the transaction marks a significant step in its funding strategy, balancing partnership objectives with a focus on capital management. In October, Orsted raised $9.4 billion through a heavily discounted rights issue to strengthen its balance sheet. The company subsequently announced plans to reduce its workforce by approximately 25% by the end of 2027.
The sale will provide Orsted with much-needed capital. Orsted has stated that this divestment aligns with their strategic goals for partnerships and capital management, which are critical to their long-term financial health.
