DONG Could Launch IPO This Summer

DONG Energy intends to launch an Initial Public Offering (IPO) of its shares on Nasdaq Copenhagen this summer.

The company plans to put at least 15% of its shares on the market through a partial sell-down by the current shareholders of DONG Energy other than employee shareholders. The final offer size will be communicated in connection with the publication of the prospectus by DONG Energy. No new share capital will be issued in the IPO, the company said.

In September 2015, the company published the conclusion of its IPO roadmap and announced it would work towards an IPO before the end of Q1 2017. “Barring unforeseen circumstances and subject to prevailing market conditions, the IPO could be launched for a listing in summer 2016,” DONG Energy said in a statement today.

According to Bloomberg’s news from September 2015, DONG Energy’s IPO could be the biggest in Danish history.

The Kingdom of Denmark will remain the majority shareholder after the IPO, as it will sell part of its current shareholding (58.8%), while maintaining 50.1% stake.

Current shareholders also include New Energy Investment S.à r.l. (indirectly owned by entities under the control of the Merchant Banking Division of The Goldman Sachs Group, Inc.) (17.9%), SEAS-NVE Holding A/S (which is directly controlled by SEAS-NVE A.M.B.A) (10.8%), ATP (4.9%) and other shareholders (7.6%).

Provided that the IPO takes place in accordance with the currently expected time plan, DONG Energy intends to pay a dividend of DKK 2.5 billion (EUR 336 million) for 2016. For subsequent years towards 2020, the company aims to increase the annual dividend by a high single digit rate compared to the dividend for the previous year, supported by expected cash flow growth from new offshore wind farms coming into operation.

“Over the past decade, DONG Energy has established a world-leading position in offshore wind, which accounted for 75% of our capital employed at the end of 2015. We have a robust and highly visible build-out plan for offshore wind, which will deliver strong and profitable growth in the coming years,” said Henrik Poulsen, CEO of DONG Energy. “Our focus on renewable energy has turned DONG Energy into one of the fastest growing energy groups in Europe with almost 2/3 of operating income generated outside of Denmark. The planned IPO will create a strong platform for DONG Energy as we continue to lead the transformation of the energy system.”

DONG Energy holds 26% of the global installed offshore wind capacity and owns a portfolio of low-cost oil and gas producing assets in Denmark, Norway and the UK. The oil and gas business is being managed for cash, which will be reinvested in renewable energy.

In 2016, the company expects to have gross investments of DKK 18-21 billion (EUR 2.4-2.8 billion). For the period 2017-2020, the total gross investment programme is expected to be DKK 60-70 billion (EUR 8.1-9.4 billion). Investments to support future growth will be focused on renewable energy, and the wind power business is expected to attract 80% of the expected gross investments from 2016-2020, DONG Energy said.