Strategic Analysis and Valuation of Ørsted A/S

Nicklas Stougaard Bredesen

Student thesis: Master thesis


Ørsted A/S, formerly known as DONG A/S, was founded in 1972 by the Danish government to reduce the dependency from oil being imported from around the world. By 2006 Ørsted became the largest energy company in Denmark after a fusion of five other energy companies were included into Ørsted. In 2012 Ørsted experienced a financial crisis driven by severe losses in their oil-division and delays on work in progress. This resulted in the decision of selling a part of the shares to new partners. With the decision Goldmann Sachs, ATT and PFA became partners with a total of 26 % of the ownership in Ørsted. Which made sure that the needed capital flow came into Ørsted, in order to continue the investment in activities and creating revenue for its stakeholders. In connection to the sale to the new partners, it was furthermore agreed that the purpose on the medium run was to get Ørsted on the stock exchange. This happened in 2016. Since the beginning Ørsted has developed and broaden its activities to other countries than Denmark. The main market for Ørsted is currently northern Europe where especially offshore wind farms is the core activity for Ørsted and its business. In connection to an increased focus on renewable energy, Ørsted became a frontier in 2017 on the energy market. A strategic decision to act as only a green energy company in the future was decided. Seen from the outside the biggest change was going from Dong A/S to Ørsted A/S, changing the focus away from fossil energy. For Ørsted the most significantly change was to take the decision of phasing out the fossil activities by 2023 and other non-core activities. The thesis consists of a valuation of Ørsted based upon restated financial statements from 2016 to 2018. The valuation is supported by a strategic analysis by performing a PESTLE, Porter’s Five forces and a SWOT analysis to identify the key challenges for Ørsted. A financial analysis upon the restated financial statements was performed in order to determine the expected development of key enablers, when calculating the market value for Ørsted. For this the DCF-model was applied which is based upon having determined the weighted average cost of capital, specified as WACC.

EducationsMSc in Auditing, (Graduate Programme) Final Thesis
Publication date2019
Number of pages78