Equinor ASA (NYSE:EQNR) shares are trading lower on Monday. The company acquired 41.19 million shares in Ørsted A/S in Denmark, representing 9.8% of the company’s shares and voting rights for $2.5 billion.
The price is based on a closing price of DKK 418 per share on October 4 and a USD/DKK exchange rate of 6.8.
This transaction makes Equinor the second-largest shareholder in Ørsted, following the Danish State, which holds a controlling stake in the company.
Anders Opedal, CEO of Equinor, said, “Equinor has a long-term perspective and will be a supportive owner in Ørsted. This is a counter-cyclical investment in a leading developer, and a premium portfolio of operating offshore wind assets. The exposure to producing assets complements Equinor’s operated offshore wind portfolio of large projects under development.”
“This investment is in line with Equinor’s strategy of value driven growth in renewables. The offshore wind industry is currently facing a set of challenges, but we remain confident in the long-term outlook for the sector, and the crucial role offshore wind will play in the energy transition.”
Also Read: Equinor Discovers Gas And Condensate In Norwegian Sea: Details
Equinor intends to increase its ownership in Ørsted to 10%, subject to regulatory approvals under applicable Foreign Direct Investment regulations, with no plans for further stake rises at this time.
In the second quarter, Equinor’s operating cash flow stood at $1.61 billion.
In August, Equinor stated it plans to invest $5.7 billion – $6.7 billion annually in Norwegian offshore oil and gas projects until 2035.
Investors can gain exposure to the stock via Keating Active ETF (NASDAQ:KEAT).
Price Action: EQNR shares are down 3.52% at $26.17 at the last check Monday.
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This article Equinor Goes Wind Shopping, Bags Hefty 9.8% Stake In Ørsted For $2.5B originally appeared on Benzinga.com
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