Norwegian energy giant Equinor has purchased a 9.8 percent stake in Danish offshore wind developer Orsted, valued at approximately $2.5 billion.
This strategic investment comes as Equinor aims to strengthen its renewable energy portfolio, despite Orsted’s recent struggles. Orsted’s shares have plummeted 69 percent from their peak in 2021, amid rising costs and technical challenges in the offshore wind sector, Reuters news report said.
Equinor’s CEO, Anders Opedal, described the acquisition as a long-term investment, highlighting offshore wind’s potential in the energy transition. The deal is expected to add 1.7 GW of net generation capacity toward Equinor’s goal of 12-16 GW by 2030. Currently, the Norwegian company has less than 1 GW of installed renewable capacity.
Orsted’s stock price surged 8 percent following the announcement, before settling with a 5.8 percent increase. However, Equinor’s shares dropped by 3.9 percent. Equinor clarified it would not increase its stake beyond 10 percent or seek board representation.
The investment makes Equinor the second-largest shareholder in Orsted, following the Danish government, which holds a 51 percent stake. Despite ongoing challenges in the offshore wind sector, both companies remain optimistic about the long-term prospects of renewable energy.