Windfarm group seeks massive IPO

Government-controlled Danish utility and wind farm group Dong Energy said Thursday that it could be valued up to $16 billion (14.3 billion euros), before what is expected to be Denmark's biggest initial public offering ever - and Europe's largest this year.

The energy group plans to sell between 15.1 to 17.4 percent of its shares when they are expected to be offered for the first time on the Copenhagen stock exchange on June 9. The Danish government will retain a 50.1 percent stake.

"The company has grown from primarily being a Danish utility business to becoming a growing international company with a leading position in the offshore wind sector," Danish Finance Minister Hjort Frederisken said.

Dong Energy was formed ten years ago from the fusion of state oil and gas suppliers as well as five other regional suppliers. It has since built more than a quarter of the world's off-shore wind farms.

High value for hot air?

Some analysts were surprised though by the high valuation, seeing it as a bullish take on the future of the wind power.

"It is a company that is relatively complex to value," Sydbank analyst Morten Imsgard told Danish news agency Ritzau," because it's crucial what expectations you have as an investor on the offshore wind turbine sector."

Ownership over the group has been a touchy political subject in Denmark. The country's Socialist People's Party exited a center-left coalition government in 2014 after a stake of Dong Energy was sold to Goldman Sachs under terms that reportedly favored the US investment bank.

With a huge presence in both the UK and Germany, the group is trying to gain a foothold in the US market.

Goldman is expected to gain over $700 million from the IPO.

jtm/jd (AFP, Reuters)