New Orsted boost as major shareholder piles into rights issue

Orsted has received a fresh boost hot on the heels of the Revolution Wind stop-work order being lifted as one of the Danish offshore wind giant’s major shareholders commits to its rights issue.

Major Danish utility Andel announced today that it is joining Orsted’s capital increase, investing DKK 3 billion ($474m) and maintaining its 5% ownership stake.

Andel group CEO Jesper Hjulmand said the board of directors and management see the move as a “responsible ownership decision” taken to support Orsted’s Danish activities and ensure it is able to deliver global CO₂ reductions.

Orsted announced last month that it would carry out a DKK 60bn ($9.4bn) rights issue after it was unable to complete an envisaged partial divestment and associated project financing of its 920MW Sunrise Wind project off New York.

That risk was borne out just weeks after the rights issue announcement, with the Trump administration’s stop-work order against Orsted’s Revolution Wind project, although a federal court issued a preliminary injunction lifting that order yesterday.

In its statement today, Andel said that “despite significant challenges in the US, Orsted, as the world's leading developer of offshore wind, is a cornerstone in the transition of the energy system to a greener future.”

Hjulmand stressed that Andel, as a cooperative, invests “long-term and patiently.”

By participating in the capital increase, Andel contributes both to “stabilising Orsted and protecting the value of the group's own strategic asset.”

"If we remain on the sidelines, our ownership stake will be greatly diluted and lose significant value,” said Hjulmand. “We believe that the value and potential of Orsted is greater than the share price and results currently reflect. By joining, we strengthen Andel's strategic asset – both now and in the longer term.”

Orsted’s majority shareholder, the Danish state, committed at the outset to participating in the rights issue, thought to be the largest in Denmark’s history. The developer’s second largest shareholder, Norwegian oil major Equinor, has also committed to maintaining its stake.

Orsted’s share price is DKK 116 at time of writing, having risen by around 10% in the last week and now only fractionally down on the level it was at before the stop-work order against Revolution Wind last month.