September 18, 2019 / 10:56 AM / a month ago

Orsted to sell its Danish power businesses for $3.2 billion

COPENHAGEN (Reuters) - Orsted (ORSTED.CO) has agreed to sell its Danish power distribution and retail businesses to energy firm SEAS-NVE for 21.3 billion Danish crowns ($3.15 billion) on a cash and debt-free basis, the Danish utility said on Wednesday.

Orsted, formerly DONG Energy, put the businesses up for sale in June 2018 as the world’s largest offshore wind developer looks to focus on its international renewable energy operations.

It is counting on the proceeds to help fund planned capital expenditure of 200 billion Danish crowns through 2025.

Orsted, 50.1% owned by the Danish state, put its divestment drive on temporary hold earlier this year after politicians interfered to avoid a sale to foreign companies.

“It’s not a question about whether it should be sold or not. It is a question about who it should be sold to,” head of the Social Democrats and today prime minister Mette Frederiksen said back then.

“It’s important that we keep critical infrastructure including the power network in hands where we keep democratic control,” Frederiksen said.

SEAS-NVE is Denmark’s second-largest cooperatively-owned energy company. It owns a 9.54% stake in Orsted which it said it plans to reduce to around 5% over the next 12 months.

Closing of the transaction is expected during the first half of 2020. Danske Bank and Citigroup acted as financial advisers to Orsted, it said.

Orsted listed in Copenhagen in 2016, when the Danish state and a consortium of investors led by Goldman Sachs (GS.N) sold shares.

The sale allowed Goldman to double an 8 billion-crown investment made just two and a half years earlier, fuelling criticism in Denmark that the previous government sold an 18% stake to the Goldman consortium too cheaply.

Reporting by Stine Jacobsen; editing by Jason Neely

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