Ørsted Acquires Deepwater Wind and Creates Leading US Offshore Wind Platform

08 Oct 2018

Ørsted has entered into an agreement with the D.E. Shaw Group to acquire a 100% equity interest in Rhode Island-based Deepwater Wind at a purchase price of USD 510 million. The two companies’ offshore wind assets and organizations will be merged into the leading US offshore wind platform with the most comprehensive geographic coverage and the largest pipeline of development capacity.

Deepwater Wind, the leading US offshore wind developer, has built an attractive and geographically diverse portfolio of projects along the US East Coast. Deepwater Wind’s portfolio has a total potential capacity of approx. 3.3GW comprising:

  • Block Island (30MW), the only operational offshore wind farm in the US
  • Three offshore wind development projects in Rhode Island, Connecticut, Maryland and New York totaling 810MW of capacity with long-term revenue contracts in place or pending finalization.
  • Approximately 2.5GW of offshore wind development potential across three well-sited BOEM lease areas in Massachusetts and Delaware. Of these 2.5GW, 1.2GW is developed through an equal joint venture with PSEG, a leading New Jersey utility.

Ørsted’s current US offshore wind portfolio has a total capacity of approx. 5.5GW comprising:

  • Development rights for up to 2GW at the Bay State Wind site off the coast of Massachusetts owned in a joint venture with Eversource.
  • Development rights for up to 3.5GW at the Ocean Wind site off the coast of New Jersey.
  • In Virginia, Ørsted will be constructing two 6MW wind turbine positions for phase one of Dominion Energy’s Coastal Virginia Offshore Wind Project. Ørsted has exclusive rights with Dominion Energy to discuss the potential development of up to 2GW of offshore wind capacity.

With the combined organization and asset portfolio, Ørsted will be able to deliver clean energy to the seven states on the US East Coast that have already committed to build more than 10GW of offshore wind capacity by 2030.

Martin Neubert, CEO of Offshore Wind at Ørsted, says“With this transaction we’re creating the number one offshore wind platform in North America, merging the best of two worlds: Deepwater Wind’s longstanding expertise in originating, developing and permitting offshore wind projects in the US, and Ørsted’s unparalleled track-record in engineering, constructing, and operating large-scale offshore wind farms. Today’s announcement consolidates Ørsted’s position as the global market leader in offshore wind with a strong foothold across Europe, North America and Asia-Pacific.”

“D.E. Shaw & Co. has been a dedicated owner of Deepwater Wind with a vision to pioneer offshore wind in the US and being at the innovative forefront of technology investment. We are excited to continue this journey and take the industry to the next level.”

Thomas Brostrøm, CEO of Ørsted US Offshore Wind and President of Ørsted North America, says“Deepwater Wind has done a fantastic job as a first-mover in US offshore wind, and I look forward to joining and integrating the two US organizations. We have exciting times ahead of us delivering large-scale clean energy projects to households and businesses along the Eastern Seaboard. Ørsted will maintain a strong presence in Massachusetts and Rhode Island and will, of course honor the local commitments associated with Deepwater Wind’s projects along the East Coast.“

Bryan R. Martin, Managing Director of D. E. Shaw & Co., says“I am deeply grateful to the many people who have made Deepwater Wind so successful and I’m excited to see what the largest and most innovative offshore wind company in the US can do when it’s merged with the largest and most successful offshore wind company in the world. I’m truly proud that offshore wind’s global leader can now author the next chapter for Deepwater Wind. Together - they’ll continue to make history.”

Jeffrey Grybowski, CEO of Deepwater Wind, says“Ørsted is one of the world’s great clean energy companies and real pioneers in the offshore wind sector. We could not be more pleased with this combination, which will bring together two great teams to realize an enormous clean energy resource for coastal populations in the US.”

After closing of the transaction, the name of the new organization will be Ørsted US Offshore Wind. The new organization will be represented by a local management team headed by Ørsted US Offshore Wind CEO Thomas Brostrøm, Co-CEO Jeff Grybowski, President and CFO David Hang both from the Deepwater Wind team, and COO Claus Bøjle Møller from the Ørsted team.

The transaction is subject to clearance by the US competition authorities and is expected to close by end of 2018.

This announcement does not change our EBITDA guidance for 2018, but increases the CAPEX guidance from 16-18 billion to DKK 23-25 billion. The CAPEX guidance includes the acquisition price of Deepwater Wind, early CAPEX commitments for the US offshore and onshore wind portfolio in Q4 2018, as well as increased spending in the remaining portfolio due to timing.

Ørsted has installed 5.1GW offshore wind capacity in Europe and has a further 3.8GW under construction. It is Ørsted’s ambition to have installed a total offshore wind capacity of 11-12GW worldwide by 2025.

Ørsted | orsted.com