Ørsted Divesting Half of Hornsea Two for EUR 3.6 Billion

Ørsted has signed an agreement to divest 50 per cent of its 1.3 GW Hornsea Two offshore wind farm in the UK to a consortium comprising AXA IM Alts and Crédit Agricole Assurances for GBP 3 billion (approximately EUR 3.6 billion).

Illustration; Installation of Siemens Gamesa Turbine at Hornsea Two; Photo: Ørsted

The transaction is expected to close in the second half of 2022, once the wind farm is fully commissioned and customary regulatory approvals are obtained. As of then, AXA IM Alts, acting on behalf of its clients, and Crédit Agricole Assurances will each own 25 per cent of the project.

The investors’ 50 per cent stake in Hornsea 2 will be funded through a combination of equity and a senior multi-tranche staple financing package provided by 30 banks and including a covered tranche guaranteed by EKF, Denmark’s export credit agency. The financing package was originated and structured by Ørsted.

Ørsted announced the Hornsea Two offshore farm-down in its 2021 annual results at the beginning of this year, when the developer also said putting the project in full operation would be slightly delayed due to the impact of the Omicron variant of SARS-CoV-2 on commissioning works.

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Ørsted is finalising the construction of the project and will provide long-term operations and maintenance (O&M) services for 20 years from its O&M base at the Port of Grimsby. The company will also provide the incoming partners with balancing services and a long-term route to market for the renewable electricity generated from Hornsea Two.

Following the transaction Ørsted’s full-year EBITDA, including new partnership agreements, is expected to be significantly higher than the 2021 EBITDA of DKK 24.3 billion (approx. EUR 3.3 billion), accordimg to the company.

Hornsea Two, located 89 kilometres off the Yorkshire coast in the Hornsea zone, is currently under construction and will become the world’s largest offshore wind farm once commissioned later in 2022.

The wind farm generated its first power in December 2021.

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When fully operational, Hornsea Two’s 165 Siemens Gamesa 8 MW wind turbines will be capable of generating 1.32 GW of clean electricity – taking the title of ‘world’s largest operating offshore wind farm’ from its sibling project Hornsea 1.

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