S&P’s downgrade of Orsted’s credit rating will not affect the Danish developer’s business plan, according to chief finance officer Trond Westlie.
In a statement to reNEWS on Friday, Westlie said the “expected updates” are “fully taken into account in the sizing of” the company’s proposed €8bn right issue, which it requires in part to deal with the collapse of a farm down of a 50% stake in the Sunrise Wind project in the US.
“We take note of S&P’s change to BBB- rating with stable outlook, and Moody’s affirming Baa2 rating with stable outlook.” Said Westlie.
“These expected updates do not impact our business plan and are fully taken into account in the sizing of the rights issue.”
Westlie was commenting after S&P downgraded Orsted’s long-term credit rating citing stalled progress on the farm down.
The rating agency said that the inability to complete the divestment, alongside associated project financing, “severely and directly hinders credit metric performance” and underscores a deterioration in Orsted’s business environment, resulting in a cut to ‘BBB-‘ from ‘BBB’ status.
However, Westlie said the rights issue will strengthen Orsted’s capital structure and bolster it liquidity reserve in support of a “solid investment grade rating and a financially robust” company, he added.
“We’re comfortable with our credit metrics and believe they are in a good place commensurate with solid investment grade rating,” he said.
“We continue to deliver on our business plan, and all our 8.1 GW offshore wind projects under construction are progressing according to plan and will, when finalised by the end of 2027, generate additional DKK 11-12 billion of EBITDA.”