The Irish Orsted unit’s €66 million dividend breached company law

An Irish subsidiary of renewable energy company Orsted Onshore Ireland breached the Companies Act last year by paying a dividend of €66.6 million to the parent company, even though €30 million of that exceeded the subsidiary’s available distributable reserves.

rsted, which acquired Brookfield’s Irish business in 2021, said the issue came to light last year.

Companies that pay dividends must have sufficient distributable reserves. Paying dividends without sufficient reserves contravenes Section 117 of the Companies Act 2014.

Orsted Onshore Ireland was previously known as Brookfield Renewable Ireland Holdings. Danish company Orsted bought Brookfield’s onshore wind energy business in 2021.

“After Orsted acquired the business in 2021, there was a change in how reserve levels were measured,” said an Orsted spokesman. “It has switched from the timing of dividend payment to using the final financial statements.

As a result, an adjustment was made in 2022 during the 2021 audit.”

Newly filed accounts for Orsted Onshore Ireland – signed by directors just last month – reveal breach of the Companies Act.

They note that the company received a €66.6 million dividend in 2021 from subsidiary Orsted Onshore Ireland Midco.

After Orsted Onshore Ireland received the dividend, the parent company’s Board of Directors approved and paid a dividend of €66.6 million to its immediate parent company, Orsted Onshore Irish Wind.

“However, after the balance sheet date it was determined by the directors of the Company’s subsidiary, Orsted Onshore Ireland Midco, that the payment of that dividend of £29.9m.

“This company did not have sufficient distributable reserves at the time of the distribution.”

The balance sheet states: “In order to correct this position, the company must repay this amount to its subsidiary in 2022.”

Orsted Onshore Ireland said it used the €66.6 million it received to pay the same amount of cash as a dividend to its parent company.

“However, as a result of the matter described above, it was determined by the directors of the company that a dividend amount of $20.3 million

https://www.independent.ie/business/irish/irish-orsted-units-66m-dividend-breached-company-laws-42265741.html The Irish Orsted unit’s €66 million dividend breached company law

Fry Electronics Team

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