Orsted Seeks $9.4 Billion Due to US Wind Market Downturn

Danish renewable energy giant Orsted (ORSTED.CO) has announced a substantial 60 billion crowns ($9.4 billion) rights issue in an effort to reinforce its financial position. The move comes at a time when the offshore wind sector faces mounting challenges in the United States, exacerbated by political resistance to wind power under U.S. President Donald Trump’s stance on the industry.

A Sector Under Strain

Orsted’s announcement underscores the extraordinary pressures weighing on the wind energy sector. In addition to unfavourable market developments in the U.S., the industry has been grappling with persistent macroeconomic volatility and complex supply chain disruptions that have strained profitability and slowed project delivery timelines.

Sharp Market Reaction

The market’s immediate response was severe. Orsted’s shares plunged as much as 29% in early trading, touching a nine-year low of 220.2 crowns before partially recovering to 228.4 crowns by 0815 GMT — still down 26% for the session. This steep decline reflects investor concerns over the significant scale of the capital raise relative to the company’s current market value.

Scale of the Rights Issue

The planned fundraising represents nearly half of Orsted’s market capitalisation, which stood at approximately 130 billion crowns at the previous trading close. While analysts acknowledge that the move will reduce financial risk and strengthen the balance sheet, they caution that the near-term dilution for existing shareholders will be substantial.

Underwriting for Completion Certainty

To ensure the transaction proceeds smoothly, Orsted confirmed that any unsubscribed shares will be fully underwritten by Morgan Stanley & Co International. This arrangement provides assurance that the capital raise will be completed in full, irrespective of subscription levels from current shareholders or new investors.

Broader Industry Context

Orsted’s financial manoeuvre follows a broader trend of strain within the offshore wind sector. Only last month, Norwegian energy group Equinor announced an almost $1 billion impairment on its U.S. offshore wind portfolio, signalling the scale of challenges that major players in the renewable energy transition are currently navigating.