Danish renewable energy developer Orsted said a recent credit rating downgrade by S&P Global will not alter its business plans, and that the financial implications have already been factored into its planned €8 billion rights issue.
S&P this week lowered Orsted’s long-term credit rating from ‘BBB’ to ‘BBB-’, citing the company’s failure to complete the partial divestment, or “farm down,” of a 50% stake in its Sunrise Wind offshore project in the United States. The rating agency said the stalled divestment and related project financing “severely and directly hinders credit metric performance” and reflects a deteriorating business environment for the firm.
In response, Orsted Chief Financial Officer Trond Westlie said the update was anticipated and had been taken into account in the company’s broader capital strategy.
“These expected updates do not impact our business plan and are fully taken into account in the sizing of the rights issue,” Westlie said in a statement to reNEWS on Friday.
“We take note of S&P’s change to BBB- rating with stable outlook, and Moody’s affirming Baa2 rating with stable outlook,” he added.
Orsted is seeking to raise €8 billion to reinforce its balance sheet after setbacks in the U.S. market, including the Sunrise Wind development. The rights issue, according to Westlie, is aimed at strengthening the company’s capital structure and improving liquidity.
“We’re comfortable with our credit metrics and believe they are in a good place commensurate with solid investment grade rating,” he said.
Despite recent challenges, Westlie maintained that Orsted’s ongoing construction activities remain on track.
“We continue to deliver on our business plan, and all our 8.1 GW offshore wind projects under construction are progressing according to plan and will, when finalised by the end of 2027, generate additional DKK 11–12 billion of EBITDA,” he said.
Moody’s has maintained Orsted’s rating at Baa2 with a stable outlook. Both agencies’ assessments follow a difficult year for Orsted, marked by cost overruns and regulatory setbacks in its U.S. portfolio.
