Farm-Down Program: Ørsted Completes Sale Of Shares in Four Uk Offshore Wind Farms to Brookfield

Fredericia, Denmark - Following the announcement in late October 2024, Ørsted announced in late December that it has finalized the sale of 12.45% minority stakes in the four UK offshore wind farms Hornsea 1, Hornsea 2, Walney Extension and Burbo Bank Extension to Brookfield. Together, the four farms have a total capacity of around 3,500 MW (3.5 GW).

Ørsted will retain a 37.55 percent stake in the four offshore parks and will continue to exercise a similar level of control and governance as before the transaction. Ørsted will continue to oversee the operation and maintenance of the wind farms in accordance with the applicable service agreements. All four assets are fully operational under long-term inflation-linked contracts for difference (CfDs).

The Danish energy group had signed a partnership agreement with Brookfield, its institutional partners and its listed subsidiary Brookfield Renewable.

The transaction is valued at GBP 1.745 billion (approx. EUR 2.1 billion). Brookfield is executing this transaction through Brookfield Infrastructure Fund V, the world's largest closed-end infrastructure fund.

Ørsted sees significant progress with regard to its farm-down program as a result of the transaction. The offshore specialist announced in February 2024 that it would accelerate divestments in the form of farm-downs and divestitures with the aim of generating proceeds in the order of DKK 115 billion (approx. EUR 15.4 billion) by 2030.

For Brookfield, the investment offers the opportunity to partner with the world's largest and leading offshore wind energy provider and invest in a scaled, fully operational offshore wind portfolio.

The agreement includes a call option that gives Ørsted the option, but not the obligation, to repurchase Brookfield's assets between two and seven years after completion of the transaction at a pre-agreed price.

Ørsted's share price fell by 12.2 percent to EUR 44 in the last year 2024 (closing price, 30.12.2024, Stuttgart Stock Exchange). The share price of the RENIXX Group currently stands at EUR 46.25 (06.01.2025, 13:03, Stuttgart Stock Exchange).

Source: IWR Online, 06 Jan 2025