Global Infrastructure Partners to a 50% stake in DONG Energy’s German Borkum Riffgrund 2 Offshore Wind Farm

Published Date : 11 Aug 2017


DONG Energy, one of the internationally acclaimed players operating across the oil & gas and energy sectors, has sold fifty percent of its shares in Borkum Riffgrund 2 to Global Infrastructure Partners III, an equity fund unit of Global Infrastructure Partners, a U.S. based infrastructure investment fund. The deal valuation is speculated to amount to around EUR 1,170 million and is yet to be finalized, subject to the approval from regulatory authorities. It is forecast that the purchase of 50% of Bunkum’s ownership will be completed by the end of 2017.

For the uninitiated, Borkum Riffgrund is under construction in the North Sea arena of Germany off the lower Saxony coast, with a target completion date of 2019. The wind farm will apparently consist of 56 MHI Vestas V164-8.0 MW wind turbines, and is predicted to have a capacity of 450 MW. In addition, the plant holds the promise to produce enough electricity to power more than 460,000 German households every year.

The offshore wind energy market player had earlier collaborated with Global Infrastructure Partners (GIP) on the Gode Wind 1 Offshore Wind Farm construction back in 2015. That strategic alliance turned out to be a huge success, based on which the former has undertaken a strategic move of selling half of its stake to the latter this year.

In addition to providing construction, energy, and procurement services as per the EPC agreement with GIP, DONG Energy will be offering maintenance & operations services to the Borkum Riffgrund 2 Offshore Wind Farm project over a longer period through its operations & maintenance base in Norddeich, Germany. Along with this, DONG is also expected to provide various successful routes to market the energy production of the venture.

With the acquisition deal resulting in the sale of 50% of DONG’s share in Borkum to Global Infrastructure Partners, the former has raised its 2017 EBITDA (Earnings before interest, tax, depreciation, and amortization) guidance. DONG also forecasts its EBITDA guidance to rise between the range of 17 to 19 billion with no gross capital investment requirements. The agreement also displays GIP’s ability to invest in high quality projects and its commitment toward building & maintaining long-term business relationships with leading global market players.

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