Brookfield Buys Into Ørsted’s Four Operational Offshore Wind Farms in UK

October 30, 2024, by Adrijana Buljan

Global investment firm Brookfield has bought minority stakes in four UK offshore wind farms owned and operated by Ørsted for around GBP 1.75 billion (approximately EUR 2.1 billion).

The buy-in, which Brookfield is pursuing through Brookfield Infrastructure Fund V, will see the investment firm acquiring 12.45 per cent in Hornsea 1, Hornsea 2, Walney Extension, and Burbo Bank Extension, which have a combined total capacity of some 3.5 GW.

All four offshore wind farms are fully operational under long-term inflation-linked contracts for difference (CfDs).

The transaction is expected to close by the end of 2024, subject to customary regulatory approvals. The agreement includes a call option under which Ørsted could repurchase the assets from Brookfield between two and seven years after the closing of the transaction at a pre-agreed price.

On 30 October, Ørsted said that with the sale of the minority stakes in the four offshore wind farms, the company made “significant progress on the farm-down programme announced as part of the February business plan update while ensuring a high level of value retention within the transaction”.

Announcing its business plan in February, Ørsted said it would accelerate the divestment programme with farm-downs and divestments expected to contribute with proceedings of approx. DKK 115 billion (about EUR 15.4 billion) towards 2030, of which about DKK 70-80 billion (approx. EUR 9.3-10.7 billion) were expected in 2024-2026.

Following the transaction with Brookfield, Ørsted will retain a 37.55 per cent ownership interest in the four offshore wind farms, in which the developer owns 50 per cent with the other 50 per cent owned by partners (Hornsea 1 by Jupiter Offshore Wind, Hornsea 2 by a consortium comprising AXA IM Alts and Crédit Agricole Assurances, Walney Extension by AIP Management and PFA, and Burbo Bank Extension by LEGO (Kirkbi) and Greencoat).

Ørsted said it would continue to exercise a similar level of control and governance as before the transaction and would also continue to oversee the operations and maintenance of the wind farms, according to the current service agreements.