Key Points:
- Orsted Hornsea 3 sale: Orsted sells 50% stake to Apollo for $6B to strengthen finances.
- Renewable partnership: Apollo funds half of the remaining costs, boosting investment in clean energy.
- Wind milestone: Hornsea 3 will power 3M UK homes by 2027 despite industry challenges.
COPENHAGEN, Nov. 3—Denmark’s Orsted said Monday it agreed to sell a 50% stake in the Orsted Hornsea 3 offshore wind farm to Apollo Global Management for about 39 billion Danish crowns ($6.09 billion). The move aims to ease financial strain and prevent a potential credit rating downgrade.
Orsted, the world’s largest offshore wind developer, has been under pressure due to rising costs, supply chain disruptions, and inflation. The sale marks a major step in its plan to stabilize its balance sheet and regain investor confidence.
Apollo, a New York-listed investment firm managing more than $800 billion in assets, will take half ownership of the 8.5 billion-pound ($11.4 billion) Hornsea 3 project and fund 50% of its remaining construction costs.
“The transaction represents a key milestone in Orsted’s funding plan and balances the key objectives for partnerships and divestments with an emphasis on capital management,” Orsted said in a statement.
Hornsea 3 project details
Located in the North Sea, Orsted Hornsea 3 is expected to reach a capacity of 2.9 gigawatts when completed in 2027. The project is expected to become the world’s largest offshore wind farm and generate enough electricity to power more than 3 million homes across Britain.
The sale leaves Orsted with 50% ownership, maintaining its role as the project’s operator. The deal also provides the company with a significant cash inflow at a time when its share price has dropped sharply — closing at 115 Danish crowns on Monday, down 85% from its 2021 peak.
Financial recovery efforts
Orsted’s sale follows a series of financial adjustments designed to reduce debt and rebuild investor trust. In October, the company raised $9.4 billion through a discounted rights issue and announced plans to cut about 25% of its global workforce by the end of 2027.
The company said the divestment aligns with its long-term strategy of developing and partially selling projects to institutional investors once construction begins, allowing it to recycle capital for future developments.
Apollo’s investment signals growing interest from global asset managers in renewable energy projects with stable long-term returns. “We see this partnership as an opportunity to support one of the most important renewable energy projects in Europe,” Apollo said in a statement.
Broader challenges in offshore wind
The offshore wind industry has faced mounting financial challenges in recent years due to higher interest rates, escalating supply chain costs, and logistical delays. In May, Orsted discontinued its Hornsea 4 project, citing cost inflation and execution risks, a move that resulted in a financial impact of up to 5.5 billion Danish crowns.
Despite these pressures, the sector remains a cornerstone of Europe’s renewable energy transition. The United Kingdom continues to lead in offshore wind capacity, aiming to reach 50 gigawatts by 2030 as part of its broader decarbonization goals.
Industry analysts say the Hornsea 3 transaction could set a precedent for similar partnerships as developers seek to share financial risk while maintaining project control.
Orsted’s deal with Apollo is subject to customary closing conditions and regulatory approvals. Orsted Hornsea 3 is expected to begin power generation in 2027, contributing significantly to the region’s renewable energy supply.
