Dong Energy Sells Stake in Hydropower Plant for $773 MillionChristian Wienberg
Dong Energy A/S agreed to sell its stake in a Swedish hydropower company for 5.2 billion kronor ($773 million) as Denmark’s biggest utility seeks to boost its capital after losing money on natural gas investments.
Dong will sell a 26 percent stake in Kraftgaarden AB to three Finnish energy companies, the Skaerbaek, Denmark-based utility said today in a statement to the stock exchange. The buyers, Kymppivoima Oy, EPV Energy Oy and Helsingin Energia, will control the stake via a consortium, Dong said.
Dong said Feb. 27 it would divest assets for about 10 billion Danish kroner, sell shares to institutional investors for at least 6 billion kroner and cut costs as debt jumped 42 percent in 2012. Dong, which is controlled by the Danish state, said it has now sold assets for 7 billion kroner, or 70 percent of its target.
“With the divestment of our stake in this Swedish hydropower company, we’re taking another significant step toward the realization of our financial action plan,” Chief Executive Officer Henrik Poulsen said in a statement. “I am therefore very satisfied that this agreement is now in place so that we can concentrate even more on our core business.”
Dong has been an owner in Kraftgaarden since 1994 via a joint venture together with Vattenfall AB, the company said. Kraftgaarden operates seven hydropower plants with a total capacity of 626 megawatts, according to Dong.