Danish offshore wind developer Ørsted has decided to discontinue the process for the partial divestment of the 924MW Sunrise Wind offshore wind farm set to deliver power to New York.

The company said that the recent adverse development in the US offshore wind market makes it impossible to complete the planned partial divestment and associated non-recourse project financing of the Sunrise Wind project on terms which would provide the required strengthening of Ørsted’s capital structure to support the company’s investment programme and business plan.

The Danish firm now plans a rights issue with pre-emptive rights for existing shareholders, which will amount to DKK 60bn ($9.36bn) in gross proceeds.

The Danish state has undertaken to subscribe for its 50.1% pro rata share of the rights issue. Any shares not subscribed for by existing shareholders by exercising pre-emptive rights or by other eligible investors are fully underwritten by Morgan Stanley & Co.

The proceeds will be used to strengthen Ørsted’s capital structure and provide financial flexibility to ensure an appropriate capitalisation in the years 2025 through 2027, during which Ørsted will deliver its 8.1GW offshore wind construction portfolio.

An investment programme of approximately DKK 145bn ($22.6bn) will be made in the period 2025-2027 relating to the company’s current portfolio of construction projects.

It will also be used to cover the funding requirements from the full ownership of Sunrise Wind. The construction of the entire project will cost around DKK 40bn ($6.24bn).

Ørsted added that it continues with the farm-down processes for its Changhua 2 and Hornsea 3 offshore wind farms. The company also launched a sales process for a potential full divestment of its European onshore business. Ørsted expects to raise more than DKK 35bn ($5.46bn) in proceeds from divestments during 2025-2026.

”Long-term, the fundamentals for offshore wind remain strong in our core markets in Europe. However, Ørsted and our industry are in an extraordinary situation with the adverse market development in the US on top of the past years’ macroeconomic and supply chain challenges,” said Rasmus Errboe, president and CEO of Ørsted.