The company, which is majority-owned by the Danish state, had sought to raise $9.4 billion through a rights issue earlier this month.
Danish firm Orsted (DNNGY) is planning to move forward with its capital raise plan despite the U.S. President Donald Trump’s administration ordering a halt to its giant offshore wind project off the coast of Rhode Island.
The company, which is majority-owned by the Danish state, had sought to raise $9.4 billion through a rights issue earlier this month. This was before the Bureau of Ocean Energy Management’s Friday order, which put an abrupt halt to the project nearing completion.
“The planned rights issue had been sized to provide the required strengthening of Orsted’s capital structure to execute its business plan, even when taking into account the impact of this uncertainty on Orsted’s U.S. offshore wind portfolio,” the company said in a statement.
Orsted’s Copenhagen-listed shares slumped as much as 19% in early trading on Monday. Retail sentiment on Stocktwits about Orsted was still in the ‘bullish’ territory at the time of writing.
Investors were planning to buy more as the stock was likely falling below the IPO level.
According to a Bloomberg News report, Orsted’s management is meeting with investors and advisers in London on Tuesday to reassure them that the situation remains under control and that the rights issue will still proceed as planned.
The stop-order was consistent with the Trump administration’s stance on wind energy. On his first day in office, Trump put all wind projects on review, citing environmental concerns for marine life and project costs.
The Trump administration had earlier moved to cancel Equinor’s wind farm development off the coast of New York, which was later allowed to move forward after New York Governor Kathy Hochul agreed to permit more fossil fuel pipelines.
According to a Reuters report, Sydbank analyst Jacob Pedersen said the cancellation will be a “huge hurdle” to raising capital. Orsted’s U.S.-listed shares have fallen nearly 30% this year.
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