Ørsted has completed its widely publicized rights issue at a heavily discounted price, raising the target amount of 59.56 billion crowns, equal to some $9.35 billion.
According to the company, 99.3% of the issue was subscribed for by existing and new shareholders, but of that total, the Danish state subscribed for just over 50%. Ørsted also said that orders for additional shares will be filled by the allocation of an additional 22,446 shares, on top of the original issue of around 900,000,000 shares.
The issue was priced at 66.60 crowns apiece, or $1.04—a heavy discount on the wind power developer’s share price, which at closing on Monday stood at 122.35 crowns, or $19.18. The head of equity analysts at Sydbank called the rights issue “a great success”, adding that “Perhaps it is even a roaring success. At the very least, it is a significant success.” Less enthusiastic observers have called it a bailout as the industry major has struggled in the past couple of years despite generous subsidies in all of its main markets.
The change of the guard at the White House made life even more difficult for Ørsted, of course, with President Trump going all the way and banning one of its biggest projects. The ban was struck down by a court, but the damage was done—Trump’s strongly anti-wind policies were one reason why the rights issue had to be discounted so heavily and why the Danish state had to shoulder half of the burden.
Ørsted said it would use two-thirds of the money raised from the rights issue to fund the construction of Sunrise Wind, a massive offshore wind project off the East Coast of the United States, because the Trump administration policies had scared of other investors, leaving Ørsted to pick up the tab.
By Irina Slav for Oilprice.com
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