Oslo (Business Emerge), October 7: Equinor, Norway’s energy company, has made a significant move to bolster its renewable energy assets by purchasing a 9.8% stake in Ørsted, a leading Danish offshore wind developer, for approximately $2.5 billion. This acquisition reflects Equinor’s commitment to expanding its renewables portfolio, despite the ongoing challenges in the offshore wind sector.
Ørsted, known as the world’s largest offshore wind developer, has faced a challenging period marked by increased costs and technical issues with turbines. Its stock price has plunged 69% since reaching an all-time high in 2021. However, Equinor’s CEO, Anders Opedal, described the acquisition as a “counter-cyclical move,” betting on a long-term recovery and growth in the offshore wind industry.
This acquisition will significantly contribute to Equinor’s renewable energy targets, adding 1.7 gigawatts (GW) of net capacity toward its goal of installing 12-16 GW by 2030. Currently, the company has under 1 GW of installed renewable capacity, making this investment a critical step in achieving its ambitious goals.
On the day of the announcement, Ørsted’s shares initially surged by over 8% before settling at a 5.8% increase. In contrast, Equinor’s shares experienced a 3.9% drop. Despite the market reaction, Equinor’s strategy remains focused on long-term gains.
Equinor clarified that it has no intention of increasing its stake beyond 10% and will not seek board representation in Ørsted. Instead, its position as the second-largest shareholder, after the Danish government, is seen as a strategic investment in the future of renewable energy.
“The offshore wind industry is currently navigating a set of challenges,” Opedal noted, “but we remain optimistic about its long-term prospects and the pivotal role it will play in the global energy transition.” The stake was acquired through a mix of market purchases and a block trade, reflecting Equinor’s strategic approach.