Mirror Review
September 2, 2025
Ørsted, the Danish renewable energy giant, has launched one of Europe’s largest-ever rights issues of DKK 60 billion ($9.4 billion) capital raise.
The comes as the offshore wind sector faces cost inflation, supply chain problems, and U.S. permitting setbacks.
Understanding how the Orsted rights issue works is necessary to see why shareholders like the Danish state and Equinor are backing it.
What Is a Rights Issue?
A rights issue is when a company offers existing shareholders the right to buy new shares at a set (usually discounted) price. It’s not an IPO or a new listing but it’s a way to raise money while giving current investors first choice to maintain their stake.
For Ørsted:
- Who can subscribe? Existing shareholders get rights (entitlements) to buy new shares.
- How does it trade? Rights can usually be sold on the stock exchange if a shareholder chooses not to subscribe.
- Who’s anchoring it? The Danish state (Ørsted’s majority owner at 50.1%) and Equinor (10% owner) have committed to subscribing in full, while global banks will underwrite the rest.
Why Ørsted Is Raising Capital
Ørsted announced the rights issue on August 11, 2025 with two key aims:
- Strengthen its balance sheet
High interest rates and U.S. regulatory delays created liquidity pressure. The new funds secure Ørsted’s financial flexibility through 2027.
- Fund offshore wind projects
Ørsted has 8.1 GW of projects under construction. These need billions in upfront capital before they start generating cash.
A stop-work order on Ørsted’s Revolution Wind project in the U.S. highlighted how fragile project timelines can be. By raising money now, the company avoids being forced into asset sales or costly delays.
How the Orsted Rights Issue Works — Step by Step
- Extraordinary General Meeting (Sept 5, 2025): Shareholders vote to approve the new share issue.
- Prospectus & Launch: Ørsted publishes a prospectus with details like the subscription price, the entitlement ratio (e.g., how many new shares per existing share), and the timetable.
- Rights Trading: Shareholders can trade their rights on Nasdaq Copenhagen. This means even if they don’t want to put in more money, they can sell the rights and capture value.
- Subscription Period: Investors use rights to buy new shares, usually at a discount to the market price. They can also apply for “excess” shares not taken up by others.
- Settlement & Listing: New shares are issued, trading rights expire, and the company receives the cash. Any unsubscribed shares are bought by the underwriting banks.
Who Is Participating In The Orsted Rights Issue
- Danish State: Will maintain its majority stake, ensuring political and financial backing.
- Equinor: Investing up to DKK 6 billion (~$939 million) to preserve its 10% holding and gain board representation.
- Institutional Investors: Including Norway’s sovereign wealth fund, which has signaled support.
- Banks: A consortium led by Morgan Stanley, BNP Paribas, and Danske Bank underwrite the rest, guaranteeing the full DKK 60 billion is raised.
Market Reaction
Analysts were caught off guard by the size of the Orsted rights issue. UBS noted that the raise amounts to nearly 46% of Ørsted’s market capitalization, far larger than expected. Furthermore, they suggested investors would want to see a clear strategy for the post-raise period. Still, with state support and Equinor’s commitment, the deal is almost certain to succeed.
What It Means for Ørsted and the Sector
- For Ørsted:
The capital raise will immediately reduce debt and secure funding to complete U.S. and European offshore projects, even under policy uncertainty without having to sell assets at a loss.
- For Shareholders:
Here’s the catch. If shareholders don’t buy the new shares, their ownership will shrink. The good news is they can still sell their rights on the market and make some money instead of losing out completely.
- For Offshore Wind:
For the offshore wind industry, this shows that only the biggest companies with strong financial backing can keep moving forward in today’s tough conditions. Smaller developers that lack government support or strong partners may have to quit or sell their projects to larger firms.
Bottom Line
The Orsted rights issue is more than just a funding exercise. It is a reset for the company and the offshore wind industry.
By raising $9.4 billion directly from shareholders, Ørsted is betting that offshore wind will remain central to the global energy transition, even in turbulent times.
For investors, the choice is clear: buy the new shares to keep your stake, sell your rights, or accept dilution.
For Ørsted, success in this raise will lock in its leadership role for the decade ahead.
