Ørsted signs €3.6bn deal to sell half of world’s largest offshore wind farm

Ørsted has signed an agreement to divest a 50% ownership stake in its 1320MW Hornsea Project Two Hornsea Project Two (1320MW) Offshoreoff Yorkshire, UK, Europe Click to see full details offshore wind farm off the Yorkshire coast of the UK to an investment consortium comprising AXA IM Alts and Crédit Agricole Assurances.

The total value of the transaction is £3 billion (€3.6 billion), and it is expected to close in the second half of 2022, once the wind farm is fully commissioned and customary regulatory approvals are obtained.

Global investors and asset managers AXA IM Alts and Crédit Agricole Assurances will each own 25% of the project. The investors’ purchase will be funded through a combination of equity and a senior multi-tranche staple financing package. 

The financing package, which was originated and structured by Ørsted, is provided by 30 banks and includes a covered tranche guaranteed by EKF, Denmark’s export credit agency. 

Philippe Dumont, chief executive of Crédit Agricole Assurances, said the investment in Hornsea Two was fully aligned with the organisation’s climate commitments. 

“This operation will also contribute to Crédit Agricole Assurances’ objectives to double its investments in renewable energies and reach an 11GW installed capacity by 2025,” he said.

“Our investment strategy is all about decarbonisation, electrification, and digitalisation. These are central to the energy transition,” said Mark Gilligan, head of infrastructure equity at AXA IM Alts. 

Ørsted is close to completing 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.

Additionally, Ørsted will provide the incoming partners with balancing services and a long-term route to market for the renewable electricity generated from Hornsea Two. 

Hornsea Two is due to be the world’s largest wind farm when it is fully commissioned later this year.

“We’re very much looking forward to working with our new partners and continuing to support the UK’s commitment to decarbonise electricity by 2035,” said Duncan Clark, head of region UK at Ørsted.

The move is in line with Ørsted’s strategy to develop and sell parts of its assets.

It closed a similar deal with Global Infrastructure Partners (GIP) for 1218MW Hornsea Project One Hornsea Project One (1218MW) Offshoreoff Yorkshire, UK, Europe Click to see full details in 2018, and to Danish pension funds a year earlier for the 329MW Walney Extension East Walney Extension East (329MW) Offshoreoff Walney Island, Cumbria, England, UK, Europe Click to see full details and 330MW Walney Extension West Walney Extension West (330MW) Offshoreoff Walney Island, Cumbria, England, UK, Europe Click to see full details complex. 

Last year, Ørsted sold the transmission assets for Hornsea One to a partnership between Mitsubishi Corporation subsidiary Diamond Transmission Corporation and Japanese utility Chubu Electric Power.