Meeting is being recorded.
Call for Orrön Energy. Very excited today to launch the recommended public offer for Slitevind AB. On the call today we have Daniel Fitzgerald, the CEO of Orrön Energy, and we also have Jonas Dahlström, t he CEO of Slitevind, who will talk in more detail to the recommended public offer. My name is Robert Eriksson. I'm Director of Corporate Affairs and Investor Relations, and on the call is also my colleague, Jenny Sandström from the communications department, our communications lead. As per usual, we have a Q&A function at the bottom of the screen. I think you're all familiar with that now from these Zoom calls. Use the Q&A function to write your questions, and they will be answered after the presentation.
Without any further ado, I would like to hand over to Daniel Fitzgerald.
Thanks, Robert, and it's a pleasure to be here today to speak a little bit more around the acquisition announcement that we made today, and that's a public offer for all of the shares outstanding in Slitevind AB. I'm joined today by Slitevind CEO, Jonas Dahlström, and together we're going to run through a little bit of the background and rationale for the transaction, and then also getting Jonas' view and perspectives on the deal before we round out with Q&A as Robert has touched on. This is a transformational transaction for Orrön Energy and the first one we've made, and it really shows the intent and ambition of Orrön Energy to grow and to prosper in the energy transition.
It's been about a month since we first launched as a standalone company following the Aker BP deal, and this transaction is really complementary, taking Slitevind's diversified asset base, adding it into Orrön's portfolio. Not only are the assets a good fit, the team, which is led by Jonas, has got a long history in the wind sector in Sweden and brings with them greenfield experience projects, brownfield repowering, and gives Orrön the ability to go and grow, both in technology, in greenfield, in consolidation, and to have a team on the ground who are plugged into the industry. This transaction is unanimously recommended by the board, and we have shareholder support of close to 65% of shareholders who either through the board recommendation and irrevocable undertakings or an intention to tender their shares have supported this deal.
That's quite compelling and gives a flavor of the shareholder value proposition for Slitevind shareholders. Finally, before we start, I'd like to take a moment to acknowledge the passing of Lukas H. Lundin. Lukas H. Lundin has been, for decades, pivotal in the success of the Lundin Group and driven shareholder value creation and stakeholder value creation for many decades in many countries across the world. Lukas H. Lundin, alongside his brother Ian, were key proponents of the success of Lundin Energy and huge supporters of this venture in Orrön Energy and a big reason why we're here today. Looking at Orrön Energy, Orrön Energy has three high-quality assets in the Nordics.
We are debt-free with a strong cash position and a strong balance sheet, and that gives us the perfect startup pack for moving into this space and looking for acquisitions and organic growth vehicles within the Nordics. Our asset base is going to be positive cash flow from the end of next year when we finally conclude on the Kaskasi project and bring that online. The three high-quality assets we have, two of those are online today generating free cash flow. Once we finish the CapEx build-out on Kaskasi, as a company, we will be generating free cash flow. Today marks the first step in delivering on our organic growth strategy and our M&A strategy.
We are and will continue to be, for the foreseeable future, a pure-play Nordic renewables company, looking at opportunities through M&A to grow our asset base, to diversify our asset base, and to build an organic growth pipeline of opportunities in the future. Since we first laid out our strategic vision and our view on the markets, very little has changed with our conviction and our direction since May when we first launched our strategy. Our view is that Europe will see significant growth in renewables, and every country across the block has an ambitious target to either increase investments in renewables or decarbonize power generation and energy systems. That's been unwavering through COVID, through the current shortage of supply and shortage of energy supply issues and price environment.
I think that will continue into the future, and we will see more and more support for renewables and the energy transition as we move forward. Our view on power pricing remains unchanged. While we see the European power segment driven by a reliance on thermal generation, high carbon pricing, high commodity pricing, and a structural underinvestment in oil and gas, we will see renewed and strengthened power pricing across the European segment. That's not changed in recent months, and if anything, security of supply and countries investing in their own energy sources is really critical today, especially as we head into winter this year.
Our view is that the onshore space has the lowest levelized cost of energy, and if we're to invest and grow, I think that's where we can take a competitive advantage to bear across that segment of the industry. We will always keep an eye on emerging technology, and although today is not about a portfolio where there is a lot of emerging technology, with this asset base and the skill set of Orrön and the Slitevind team, we have the skills we need to look at greenfield and emerging technology opportunities. Where we see Orrön within this space, we see this deal giving us opportunities to add greenfield, brownfield, repowering, consolidation, and new technology growth in the asset base and portfolio that we have. Orrön is 100% merchant price exposed today, and Slitevind is largely merchant exposed as well.
As we move forward, we're ticking a box on many of these strategic directions, and we take opportunity to further grow the business through all of these. That's a quick snapshot of Orrön. We should move forward now into the transaction highlights and about the deal that we've announced today. We've touched on the fact that this delivers very quickly on our M&A strategy across the Nordics, and this is a diversified asset base generating over 400 gigawatt hours per annum with the potential to grow organically. Now we have that asset base.
I think Slitevind have had a great track record of growing through consolidation, and I see more and more opportunities for consolidation across the parts of the wind industry that they've been targeting and the opportunity to add other technologies and other opportunities into existing sites where we have either a grid connection, older turbines, repowering or land positions, potentially for blending some of the technologies. The two companies coming together adds financial and organizational capacity for the future, and I think it's a really complementary set of assets and team between Orrön and Slitevind with the right entrepreneurial mindset to grow in the future. If we take a few minutes to look at the transaction itself, today we've announced an all-cash deal at a price of SEK 125 per share for all shares outstanding in Slitevind AB.
That represents either a 21% premium to the closing price on Friday, a 30% premium to the 30-day volume-weighted average price, or a 40% premium to the 180-day volume-weighted average price. I think that that's a compelling offer in front of shareholders today. This offer is unanimously recommended by the Slitevind board. It's supported by the three largest shareholders, one private individual and two institutions, who together have signed irrevocable undertakings with Orrön Energy to tender their shares into this process. On top of that, we've had contact with around 10% of the outstanding shares, represented through a number of companies and private individuals, who also have given us their intention to tender their shares to the process.
The board recommendation or the board members who are standing behind the recommendation together hold just shy of 7% of the outstanding shares in the company. That gives us over 65% of the outstanding shares have either recommended the transaction, signed an irrevocable undertaking or intend to tender their shares into this process. This deal is fully financed, and we're gonna touch on that a little bit more in the next slide, looking at Orrön's financial capacity for this and future transactions.
The acceptance period for this offer runs for three weeks starting tomorrow until the twenty-third of August, and we would urge all shareholders to have a look at all of the details in the offer press release, the offer documents, which are now live on our website, and they contain all of the terms and conditions for this offer and the details of which shareholders have signed irrevocable undertakings or intend to tender their shares. It will give a further breakdown of the criteria required to close this transaction. As I said before, Orrön Energy is financially strong.
We have existing cash reserves, which we've disclosed before, and today we're announcing a committed finance facility with SEB, and that gives us enough capacity between the cash available and this outstanding facility to fund the entire transaction plus our future CapEx, and it gives us further headroom for future M&A beyond this. Putting the two assets and companies together generates a higher cash flow stream and gives us even more debt potential once we take into account the diversified portfolio and the cash generation in the current environment. That is a great platform, which takes our first transformational step and allows us the opportunity to continue on that growth phase.
We're by no means done in terms of the M&A space, and we continue to look at many opportunities, both for some of the smaller assets in line with Slitevind's historic strategy and some larger transformational acquisitions and new projects. We remain active in that M&A space, and we have more than enough financial firepower to step in for further transactions. The map on the right shows an overview of Slitevind's asset base, and you can see here the stakes in a broad range of assets, primarily across the south of Sweden, with some in the SE2 price region. If you look at the graph on the left, over 85% of production is in the high-priced regions of SE3, SE4, FI or NO5.
That looks at the combined entity and we remain merchant-exposed in some of the highest priced regions in the Nordics. We intend to stay with that same high level of merchant exposure. Slitevind owns anywhere between minority interests up to 100% of assets, and we own anywhere between 50 and 100% of assets in our portfolio. There's a lot more opportunity for consolidation, both in the asset base that Slitevind currently hold and in future acquisitions which Slitevind have been looking at and which we've been looking at in terms of continuing to grow this portfolio. We see with all of the ingredients we've already disclosed, we see future opportunity to continue to grow in this space.
If we look at the production outlook for the company, this is an updated guidance, long-term guidance chart where we show now that Orrön Energy, combined with this acquisition today, will generate over 1 terawatt-hour of production from 2024 onwards when Kaskasi is fully online. You can see the material additions to the short-term production profile by bringing the Slitevind assets into our portfolio. We will have around 340 megawatts of installed capacity after this transaction, and with the diversified mix of both technology in terms of manufacturers of turbines, assets and sites, we believe it's a really strong portfolio of producing assets in what is a very record high power pricing environment at the moment. With that, I'm going to pass the floor over to Jonas in a second.
I think Slitevind have had a great journey from 1992 when they first started through till now, and the last five years have really seen great growth in consolidation in the space. Jonas, it'd be great to hear your perspectives on this and your views on the transaction.
Thank you, Daniel. I think number one is that I do agree with everything Daniel is saying, which is a good start. I think this is a great opportunity for Slitevind's shareholders to realize a significant premium to market value. The offer is, as we have heard, fully supported by the board, and it has a very strong support from our major shareholders. Slitevind was established in '92, so we have been around for a while. There are few companies in the business with the same experience and network. We focus on operational assets with proven production capacity, and it happens that we do buy projects in need of financial restructuring.
Since 2015, we have taken an active role in the consolidation of the small and medium-sized Swedish wind power market, and we have had some 25% annual growth in production. On top of that, the team, as Daniel mentioned, has a background in greenfield development, which gives extra opportunities when we now are joining forces with Orrön. We are excited to join the Orrön team, and I want us to take a leading role in the energy transition in the Nordics. We are looking forward to this transaction to be closed, so to speak.
Thanks, Jonas, and I think we've worked together for a short while with Slitevind and their team, and I think it's a great fit. We come from the Orrön side with an entrepreneurial mindset, a small company approach, and I think it's a very good match with Slitevind's team. I think together with the financial firepower, the backing of the Lundin family and Lundin Group, with Slitevind's track record and their growth profile over the last couple of years and network, I think we've got a fantastic company moving forward through this energy transition. Just before we wrap up, I think it's good to spend a little bit of time on Orrön Energy and we don't really exist as an investment opportunity across the market today. With this acquisition, we become one of the largest listed pure-play renewables companies in Sweden.
There's not many of our size and scale, and more than that, there's not many of our size and scale that are fully funded for future acquisitions and have the financial firepower to do that. There's growth opportunities, there's upsides in our asset base and in the sector as a whole, and we're targeting a lot of those today. We're moving fast on the M&A space, and we have a lot of opportunity in front of us. We are an asset owner, and we intend to continue to be an asset owner and stay exposed to the strong market prices that we see today.
All of that together gives us a diversified asset base, it gives us scale, it gives us financial firepower, and it gives us an entrepreneurial mindset with the team to go and chase opportunities to add value for shareholders. With the experienced board and the support of the Lundin family, I think we have all the ingredients we need to be a really strong company, and as Jonas says, to take a leading role in the renewable energy growth in the Nordics. We're listed on the main Nasdaq market and as a slight differentiator to a lot of the rest of the renewables industry across the Nordics, we have really high liquidity.
We've been trading around 8 million shares every day since we started trading back in early July, and that corresponds to a value of around $7 million trading every day. We're listed, we're liquid as a stock, we have a great team, we have a great track record with the support of the Lundin Group and Lundin family and experienced board, and in front of us is a pathway where there's an untapped amount of potential in the renewable space over the next decades across Europe. I think that really makes a unique investment opportunity for Orrön Energy and for our shareholders. Finally, before we move into Q&A, I think summing up this transaction and where we are today as Orrön Energy, our aim is to create value through the energy transition. We're delivering.
Today, we're delivering on our M&A strategy, and this is the first of hopefully many transactions in this space. We're aiming to create a leading Nordic renewables company, and this transaction also stands behind that and gives us the ability to then step across Europe a little bit more broadly. We will have greater than 1 terawatt hour of power generation, generating long-term cash flow and that you'll see a growth in our production profiles over the coming years as we see Castberg coming online and you see further M&A. I really believe that this is a unique energy transition and investment. There's upsides in the asset base, there's upsides in the way we look at the industry, and we remain merchant exposed in a very strong power price environment.
With all of that together, I think we'll pass back to Robert, who can lead us through any of the Q&A that we have coming through. Thank you.
Thank you, Daniel, and thank you, Jonas. I'm happy to say that we do have quite a few questions. I think we should get started with those right away. The first question is regarding the net debt that Orrön is taking on in this transaction by acquiring Slitevind. If you can comment on how much debt will be transferred from Slitevind.
Yeah, I think Slitevind's debt position, it depends. We'll share more details of that as we go through the closing period and close the transaction. Slitevind, as at the end of Q1, had around $45 million of debt, and that will transfer either onto our new finance facility or we will negotiate with the lenders on their side. You can expect that that comes across, and that'll be covered either through the existing cash we have on hand or it'll be moved into our debt facility.
Thank you, Dan. The next question, I think you can answer it, Dan, it's about the guidance from Slitevind, the guided 430 gigawatt hours of production in 2022. Is this the net production that you will take over or is this a gross number? If so, what is the ownership share Slitevind has in the 140 megawatt of assets?
Jonas, you can pick this up afterwards if I get anything slightly different. I think Slitevind today has 430 GWh of net production in 2022 and has around 150 MW of installed capacity, and that's before the two transactions that Jonas and Slitevind announced through the summer of this year. It will, in essence, be slightly higher net in terms of GWh and installed capacity than the two numbers shared just there. Jonas?
Let me see. Jonas might be
Yeah. No, that's correct. 430-440 GWh, that's the net production. We have announced two transactions in June, and they will be closed in October. The current net production is 430-440 GWh.
Thank you very much, Jonas. I think the next question is actually for you. If you could comment a little bit further on PPAs, offtake, hedging agreements in the portfolio. How much is merchant spot price and how much is PPAs? What is the tariff rate on the PPAs?
No, I think if you look at the second half of this year on the combined entity, there's very little in terms of hedging, so we'll be less than 10% as a net portion of the portfolio that's hedged. There's nothing on long-term PPAs, it's short-term rolling hedging. At that less than 10% level of the combined entity, it's a very small amount of hedging that's going to be in place for the future business.
From our perspective, the easiest way is to, I think it's page five or six in our Q1 report. There you can see the hedges we had at that time, and it's very little difference since that. We will then disclose the existing situation in our Q2 report. Five or six, page five or six in the Q1 report. As Daniel said, we are very highly exposed to the merchant market.
Thank you, Jonas. The next question. Most of these questions are about Slitevind, which is natural, of course, maybe another one for you, Jonas. Is there any remaining CapEx in Slitevind today that Orrön will take over as part of this takeover?
We have no projects under construction as we tend to invest in operational assets. However, if we use the 430-440 GWh production figure net, there is no CapEx to take over. With the two deals announced in June that will increase our production above that figure, there is some payments at closing that will be taken over by Orrön. Based on the 430-440, there is zero.
Very c-
I think our CapEx guidance in the future, which is primarily for the Karskruv asset, remains unchanged with this transaction.
Thank you to both Daniel and Jonas. The next question is about potential other buyers or interested parties. Have you had any discussions, Jonas, with other buyers or interested parties?
I mean, as a lot of things are, it happens a lot of things in this industry, so we do meet people and talk to people. Our main focus is to close this, to get this one closed and to continue the business with joint forces with Orrön.
Thank you. The next question is about the portfolio of Slitevind. Do you have any greenfield assets at par, as part of your portfolio?
We have no greenfield assets. It's brownfield, and it is the existing production capacity that we have shared. As we hold a minority, we normally hold majority stakes in different projects, which means that there are minority stakes as well. In that, there is a substantial growth potential to so to speak become 100% owners in various wind farms where we are represented. As we talked about during the presentation, the Slitevind team, our background is with development. Before we joined Slitevind, we worked with development.
We have a substantial track record when it comes to greenfield development, and there are possibilities for us to use those skills and take up greenfield development. But at present, we have no greenfield assets in our portfolio.
Next one for Daniel. How does this transaction value Slitevind on a euro per megawatt basis, if you could talk a little bit around that?
Yeah. If you look at the offer price around 125 SEK per share, plus the debt of Slitevind, you end up at around $130 million or so. Well, we can talk euros as well, or dollars. They're roughly the same these days. We end up with around $130 million. We've got 150 or so of installed capacity. Well, EUR 1 million or $1 million per megawatt of installed capacity, there or thereabouts.
Thank you, Dan. We do not have any further questions at this time, so I would certainly like to thank both Daniel and Jonas and thank all the participants. You can rest assured that we will continue to keep you updated through webcasts like this. We do have our Q2 report coming out on Friday this week. Dan, over to you.
Thank you, Robert. It's great to sit here today to announce this transaction and great to have Slitevind and their team coming to join us on top of the asset base. I think this does truly create a unique company in this space with the assets, the team, the knowledge, and the firepower to go and grow through the energy transition and to stay exposed to the merchant price and the increasing price across Europe of energy. With that, I think we'll have to pause, and we'll have to wait and see for when and how the next transactions come about. In the meantime, with Jonas and the Slitevind team and ourselves, we hope that most of the shareholders will tender shares on top of those that have already signed up.
I would urge all of the shareholders to go onto our website should they need more information on the offer or the terms and conditions or details, and to tender the shares towards this offer. If there's anyone that needs further information or help, feel free to reach out either to Robert, Jonas, or anyone in the team to run through the process for tendering the shares. Thank you very much, and I wish you a good afternoon.
Thank you.