Orkla Divests Hydropower Assets in Strategic Move to Streamline Operations

Orkla Divests Hydropower Assets in Strategic Move to Streamline Operations

(IN BRIEF) Orkla has entered into agreements to sell its entire hydropower portfolio in two separate deals valued at NOK 6.1 billion. The assets include hydropower production at Sarpefossen, Mossefossen, and the Saudefaldene and Trælandsfos sites. The sales align with Orkla’s strategy to simplify its business and focus on its brands and consumer-oriented operations. The transactions are expected to close by the end of Q3 2025, pending regulatory approval.

(PRESS RELEASE) OSLO, 25-Jan-2025 — /EuropaWire/ — Orkla has announced the sale of its entire hydropower portfolio in two separate transactions, valued at NOK 6.1 billion on a cash and debt-free basis. The portfolio is held through full ownership of three holding companies: Sarpsfoss Limited, Orkla Energi AS (which holds an 85% stake in AS Saudefaldene), and Trælandsfos Holding AS.

In the first transaction, Hafslund AS (90%) and Svartisen Holding AS (10%) will acquire Sarpsfoss Limited, which includes hydroelectric power production assets at Sarpefossen and Mossefossen. The combined assets generate an average of 536 GWh per year. Meanwhile, Å Energi will acquire Orkla Energi AS and Trælandsfos Holding AS. As part of this deal, the Saudefaldene assets will be leased until 2030, after which Statkraft will take over ownership for a regulated compensation. These assets have a combined average annual production of 1,860 GWh, with 1,072 GWh under fixed delivery agreements. The Trælandsfos assets produce an additional 61 GWh per year.

Orkla’s decision to sell its hydropower assets aligns with the company’s broader strategic goals. During its Capital Markets Day in November 2023, Orkla revealed that it was exploring options to unlock the maximum value from its hydropower holdings, including a potential sale. “As an industrial investment company focused on brands and consumer-oriented businesses, the sale of the hydropower portfolio reduces complexity and fulfills our communicated strategy,” said Nils K. Selte, Orkla’s President and CEO.

The sale is expected to generate an accounting gain for Orkla of approximately NOK 5 billion. However, the transactions are subject to approval from the relevant competition authorities and the Norwegian Ministry of Energy. The deal is anticipated to be finalized by the end of the third quarter of 2025.

DNB Markets, a part of DNB Bank ASA, served as financial adviser to Orkla, while Wiersholm law firm acted as legal adviser during the transaction.

About Hafslund AS
Hafslund is an energy and infrastructure group consisting of three business areas, all working towards a world in balance with renewable energy. Hafslund owns and operates 81 hydro power plants, amounting to 21 TWh, from four power production areas: Aurland, Hallingdal and Valdres, Innlandet and Glomma. Hafslund AS is 100% owned by the Oslo municipality.

About Svartisen Holding AS
Svartisen Holding is a Norwegian entity owned by three Finnish utilities; i) Vantaan Energia Oy, ii) Oy Turku Energia – Åbo Energi Ab and iii) Keskusosuuskunta Oulun Seudun Sähkö. Svartisen Holding AS owns 55 year off-take rights related to the Svartisen hydro power plant in Meløy and 10% of Hafslund Produksjon Holding AS.

About Å Energi AS
Å Energi is Norway’s largest vertically integrated renewable energy company, with operations across the entire value chain, from power production to end customers. Å Energi operates 73 wholly and partly owned hydropower plants, generating around 11.3 TWh each year, and is the second largest grid operator, supplying power to approximately 432,000 customers in Buskerud and Agder. Å Energi is owned by 30 municipalities in Agder and Buskerud, Vardar, Lier Everk Holding, and Statkraft.

About Orkla ASA
Orkla ASA is a leading industrial investment company. Its scope of activity is brands and consumer-oriented companies. At present, Orkla has 11 portfolio companies operating in segments including paints, food, chocolate, sweets and snacks, health products and food ingredients. In 2023, Orkla generated revenues of NOK 67.8 billion and achieved a pre-tax profit of NOK 7.0 billion. The Orkla Group has approximately 20,000 employees. Orkla is headquartered in Oslo, Norway, and is listed on the Oslo Stock Exchange.

Orkla ASA is a leading industrial investment company. Its scope of activity is brands and consumer-oriented companies. At present, Orkla has 11 portfolio companies.

Orkla has a long-term, industrial approach to its portfolio companies. We invest in companies where we can contribute to further value creation through our industry expertise, consumer insight and experience in building leading brands.

Orkla ASA is listed on the Oslo Stock Exchange.

Media Contact:

Annie Bersagel
SVP Investor Relations & Communication
annie.bersagel@orkla.no
+47 986 03 664

SOURCE: Orkla ASA