Stockholm (NordSIP) – On August 11, Danish renewable energy giant Ørsted suffered its largest-ever single-day share price drop (-30%), after announcing a DKK 60 billion (approx. €8 billion) rights issue to shore up its balance sheet. The equity raise, equivalent to roughly half of Ørsted’s market capitalisation, comes after the company halted plans for a partial divestment of its U.S. Sunrise Wind offshore project, forcing it to finance the development entirely on its own.
Located off the coast of New York, the 924 MW Sunrise Wind project is a flagship U.S. offshore development intended to supply power to over half a million homes and remains on track for completion, alongside the Revolution Wind project off Rhode Island. Ørsted had planned to sell a minority stake in the project to bring in co-investors, following its long-standing “farm-down” model to recycle capital. However, the deal collapsed when potential buyers walked away. Ørsted specifically noted that “material adverse developments” in the market, including the suspension of new federal offshore wind lease sales and import tariffs on key components, undermined investor appetite.
Ørsted attributed the setback to these regulatory headwinds, combined with already challenging macroeconomic conditions. Reports point to a hostile political climate under the current U.S. administration, making increasingly unviable the co-investment that form an essential part of Ørsted’s financing model.
The market’s reaction was swift and brutal. Ørsted’s stock fell by approximately 27%–31% on the day of the announcement, marking an all-time low and dipping below its 2016 IPO price of DKK 235. Analysts warned that the dilutive impact of the rights issue, combined with increased U.S. exposure and project-level risks, could weigh on the company’s outlook for years to come.
For investors focused on the energy transition, Ørsted’s plight underscores both the capital-intensive nature of offshore wind and the fragility of its economics in volatile policy environments. The case may serve as a cautionary tale about the intersection of political risk, financing strategy, and the global race to scale renewable infrastructure.
This article was written with the help of AI; edited and fact-checked by the NordSIP team.
Stockholm (NordSIP) – On August 11, Danish renewable energy giant Ørsted suffered its largest-ever single-day share price drop (-30%), after announcing a DKK 60 billion (approx. €8 billion) rights issue to shore up its balance sheet. The equity raise, equivalent to roughly half of Ørsted’s market capitalisation, comes after the company halted plans for a partial divestment of its U.S. Sunrise Wind offshore project, forcing it to finance the development entirely on its own.
Located off the coast of New York, the 924 MW Sunrise Wind project is a flagship U.S. offshore development intended to supply power to over half a million homes and remains on track for completion, alongside the Revolution Wind project off Rhode Island. Ørsted had planned to sell a minority stake in the project to bring in co-investors, following its long-standing “farm-down” model to recycle capital. However, the deal collapsed when potential buyers walked away. Ørsted specifically noted that “material adverse developments” in the market, including the suspension of new federal offshore wind lease sales and import tariffs on key components, undermined investor appetite.
Ørsted attributed the setback to these regulatory headwinds, combined with already challenging macroeconomic conditions. Reports point to a hostile political climate under the current U.S. administration, making increasingly unviable the co-investment that form an essential part of Ørsted’s financing model.
The market’s reaction was swift and brutal. Ørsted’s stock fell by approximately 27%–31% on the day of the announcement, marking an all-time low and dipping below its 2016 IPO price of DKK 235. Analysts warned that the dilutive impact of the rights issue, combined with increased U.S. exposure and project-level risks, could weigh on the company’s outlook for years to come.
For investors focused on the energy transition, Ørsted’s plight underscores both the capital-intensive nature of offshore wind and the fragility of its economics in volatile policy environments. The case may serve as a cautionary tale about the intersection of political risk, financing strategy, and the global race to scale renewable infrastructure.
This article was written with the help of AI; edited and fact-checked by the NordSIP team.
