Apollo in Talks to Take 50% of Orsted’s Hornsea 3 as US Buyout Interest Grows in UK Windfarm
US private equity firm Apollo is reported to be negotiating a half-stake deal with Orsted for Hornsea 3, while the Danish developer seeks to bolster its balance sheet amid rising costs and policy headwinds.
Apollo Global Management is in discussions to acquire a 50% stake in Orsted's Hornsea 3 offshore wind project, according to CITY & FINANCE REPORTER. The talks underscore rising appetite from US private equity for Europe’s renewable energy assets as the sector contends with higher financing costs and policy headwinds.
Orsted, the world’s largest offshore wind farm developer, has installed Hornsea 1 and Hornsea 2 and is developing Hornsea 3. It has called off Hornsea 4, citing higher interest rates and greater supply-chain costs that complicate project development.
Orsted plans to raise about £7 billion through a rights issue to shore up its balance sheet, a move that reflects the financial strain facing the company as it navigates a tougher financing environment and rising costs. The deal with Apollo would provide a fresh source of capital at a time when the group is cooling some of its project ambitions to preserve liquidity.
The Danish company has faced a mix of financial and political headwinds. In the United States, former President Donald Trump has been a vocal critic of wind energy and has sought to block Orsted developments there, contributing to policy uncertainty around renewables that can spill into investor sentiment for European projects. Shares in Orsted were down about 36% for the year to date in Copenhagen, underscoring the pressure on the business as costs mount and as investors reassess the economics of large offshore wind schemes.
Across Britain, Orsted's 12 offshore wind farms supply roughly 7% of the country’s electricity, underscoring the strategic importance of Hornsea 3 and the potential impact of any major stake sale on the pace and cost of UK wind development. A sale would mark one of the more high-profile moves by US private equity into UK energy infrastructure amid a broader shift in market funding for renewables in a higher-rate environment.
Industry observers note that a stake sale in Hornsea 3 would be among the largest privatized renewables assets in Europe in recent years, and could influence the capital structure of future UK offshore wind projects as developers seek cost of capital relief amid volatile interest rates. The situation also highlights how geopolitical and domestic political dynamics can intersect with energy markets, shaping financing choices and project timelines in the ongoing shift toward cleaner energy.