Orsted's Worst Week on Record: A Cautionary Tale for Green Energy Investments

Orsted's stock has plummeted 34% this week, its worst week on record, as the company plans to raise up to $9.4 billion in a stock sale. The wind power pioneer's market value has fallen to around $14 billion, less than a tenth of its peak valuation in 2021. Analysts expect investors to wait for further visibility before considering a rebound in shares, and the company's rating was downgraded to BBB- by S&P Global Ratings.

Orsted's stock has experienced its worst week on record, with a 34% plunge as the company announced plans to raise up to $9.4 billion through a stock sale. The wind power pioneer's market value has fallen to around $14 billion, less than a tenth of its peak valuation in 2021 [1]. Analysts have expressed caution, expecting investors to wait for further clarity before considering a potential rebound in shares. S&P Global Ratings has downgraded Orsted's rating to BBB- [2].

The Danish company, Europe's largest wind power provider, cited "extraordinary situation" in the U.S. market as the primary reason for the fundraising effort. Ørsted's CEO, Rasmus Errboe, stated that recent developments in the U.S. have made it impossible to raise the necessary funds through traditional means, such as selling stakes in new projects [1]. The company's market value has been significantly impacted by President Trump's hardline stance against wind power, which has led to a decline in the value of its U.S. projects [1].

The fundraising will be backed by the Danish government, which owns half of Ørsted, and will be underwritten by Morgan Stanley for any unsubscribed shares. The proceeds will be used to fund the construction of the Sunrise Wind project off the coast of New York and the Revolution Wind project off Rhode Island, as well as to strengthen the company's overall financial position [1].

Orsted's stock has been volatile in recent years, with the company facing challenges such as soaring inflation, logistical problems, and shifting subsidy policies. The company has canceled several projects in the U.S. and Britain to cut costs and manage its balance sheet [2]. Despite these challenges, Ørsted remains committed to its goal of building enough offshore wind farms to power more than 8 million homes within the next two years.

Analysts have expressed mixed views on the company's prospects. While some view the fundraising as a necessary step to de-risk the company's balance sheet, others have criticized the dilution of shares for existing investors. The Danish state's agreement to subscribe to a similar portion of the share issue will help maintain a majority stake in the company [2].

In conclusion, Orsted's stock plunge and subsequent fundraising effort highlight the challenges faced by the offshore wind industry in the U.S. market. While the company remains committed to its long-term goals, investors will be closely monitoring its progress and the impact of the fundraising on its financial health.

References:
[1] https://www.theguardian.com/environment/2025/aug/11/orsted-wind-generator-shares-sink-9bn-cash-call
[2] https://www.reuters.com/world/europe/orsted-plunges-it-seeks-94-billion-cope-with-trumps-hostility-wind-power-2025-08-11/