Political Uncertainty Looms Over Ørsted's State Ownership

Danish election reignites debate over state's 50.1% stake in Ørsted, creating investor uncertainty despite the firm's improving operational and financial performance.

Just as Ørsted demonstrates signs of operational and financial stabilization, a familiar debate has resurfaced to cloud its outlook. The question of government ownership is once again taking center stage, fueled by Denmark's ongoing election campaign. This political development introduces a fresh layer of uncertainty for investors assessing the future of the renewable energy giant.

Election Dynamics Reignite Ownership Debate

Following Prime Minister Mette Frederiksen's call for a snap election, the Danish campaign period commenced on February 26. Voters will head to the polls on March 24 to elect a new parliament.

A key issue emerging is the state's 50.1% majority stake in Ørsted. Several political parties are advocating for the government to divest this holding after the election. Reports from Finans indicate that four right-leaning parties are pushing for a concrete exit plan. A fifth party, the Liberals, which is part of the current governing coalition, has stated it would not block such a proposal. Collectively, these five parties hold approximately 40% of the seats in the outgoing parliament.

However, current polling suggests an immediate sale remains politically unlikely. A recent survey by the public broadcaster DR projects that the five right-wing parties could secure 74 out of 179 parliamentary seats—insufficient for a majority. Polls currently point toward a left-leaning government forming, which has not signaled any willingness to sell the stake. Furthermore, two of the parties have proposed that strategically important Ørsted assets, deemed crucial for national energy infrastructure, should be carved out and retained by the state prior to any divestment.

Operational Performance Shows Resilience

Amid the political discourse, Ørsted's underlying business metrics reveal a firmer footing. The company reported EBITDA (excluding new partnership agreements and cancellation fees) of DKK 25.1 billion, landing within its guided range of DKK 24 to 27 billion. The group's net profit for the year stood at DKK 3.2 billion.

A significant factor in this recovery has been the strengthening of its capital structure through a share issuance. Ørsted also announced it completed its 2025-2026 divestment program ahead of schedule, generating higher proceeds than initially anticipated.

A major transaction in this program was the agreement to sell its entire European onshore business to Copenhagen Infrastructure Partners (CIP) through its fund "Copenhagen Infrastructure V (CI V)." The deal carries a transaction value of €1.44 billion (DKK 10.7 billion), with completion expected in the second quarter, pending regulatory approvals. In total, Ørsted estimates proceeds from completed and agreed transactions for the 2025-2026 period at approximately DKK 46 billion, surpassing its target of more than DKK 35 billion.

The company's financial outlook remains unchanged. For 2026, Ørsted anticipates EBITDA (again excluding new partnerships and cancellation fees) exceeding DKK 28 billion, with gross investments projected between DKK 50 and 55 billion. Analysts at Jefferies noted that the offshore wind segment outperformed expectations by about 4%, supported by lower development costs and better site performance, partially offset by negative earnings contributions from construction agreements. In onshore, Jefferies reported EBITDA of DKK 1.36 billion, roughly 24% above consensus, primarily due to divestment gains booked within the quarter.

Managerial Transaction and State Support

In a separate regulatory filing this week, Ørsted disclosed a transaction by a member of its senior management. The company issued a mandatory notification under Article 19 of the EU Market Abuse Regulation (Regulation No. 596/2014), reporting a share-related transaction by Chief Development Officer Amanda Ash Dasch on March 3.

The market is also weighing the recent state-backed stabilization effort. The Danish government participated in a support package, subscribing to half of the approximately DKK 60 billion capital raise conducted in October, which Ørsted required amid industry headwinds. The irony that calls for a state exit are growing louder shortly after this crucial intervention adds further complexity to the debate.

Investors' next scheduled update will be the quarterly report on May 6. Until then, the election on March 24 and the ensuing discussion regarding the state's shareholding are likely to be the dominant themes driving sentiment, even as Ørsted maintains its firm 2026 financial guidance.