in News Departments > New & Noteworthy
print the content item

Venture-capital (VC) funding in the solar sector continued to rise steadily in the second quarter, according to Mercom Capital Group's new report on funding and mergers and acquisitions (M&A) activity in the solar market.

According to the report, VC funding totaled $376 million in 32 deals in the second quarter, compared to $329 million in 34 deals in the first quarter.

"With news of solar companies downsizing or going out of business seemingly every day, continued steady VC investment activity in the sector is good news," notes Raj Prabhu, managing partner at Mercom Capital Group. "Since 2011, most solar VC investments have gone to thin-film companies, with $835 million, and with panel prices falling more than 60 percent over the same period, solar downstream companies have been an attractive play."

Downstream companies received the most funding, with $133 million in nine deals, followed by thin-film companies, with $121 million in four deals.

“In this quarter, we are finally seeing VC investments catch up, with downstream receiving the most funding,” Prabhu adds. “Balance-of-system (BOS) companies also represent a significant opportunity for investment, innovation and cost reduction - and they are now the largest slice of the solar system pie - but VC investments in BOS have been surprisingly low.”

In fact, VC investment in BOS companies has totaled just $35 million this year, Mercom says.

The top five VC funding deals made up approximately 71% of the total funding this quarter, led by a $70 million raise by copper indium gallium diselenide thin-film maker Nanosolar. Other top VC deals included $60 million by solar lease company SunRun and a $55 million raise by solar energy services provider SunEdison.

Other top deals were $33 million raised by thin-film equipment and coating company Beneq and $25 million each raised by microinverter company SolarBridge and mono-crystalline silicon cell company Solexel.

There were 60 different VC investors that participated in the 32 deals. VC firms that recorded multiple rounds included Crosslink Capital, Kleiner Perkins Caufield & Byers and the VC/Private Equity arm of International Finance Corp.

The U.S. continued to be the dominant country for VC investments, accounting for approximately 87% of all VC funding in the second quarter.

M&A activity
M&A activity in the solar sector totaled $325 million in 14 transactions in the second quarter. Only six of these transactions disclosed details.

The top M&A transaction was the acquisition of Zhejiang Topoint Photovoltaic, a Chinese monocrystalline and polycrystalline maker, for $276 million by Guangxi Beisheng Pharmaceutical in an asset-restructuring plan.

“Most of the M&A activity were small strategic transactions, with a few of them being acquisitions of business divisions for synergistic reasons,” Prabhu notes. “In some cases, acquisitions were of ‘sick’ companies getting rid of non-strategic businesses and assets.”

The second quarter also saw 13 new cleantech and solar-focused investment funds announced, committing a total of $3.2 billion.

A complete list of the solar-sector transactions completed in the second quarter is available here.


IronRidge_id1414

Surrette_id1409
Latest Top Stories

Installer's Survey Shows Solar Energy Customers Predominantly Middle Class

Massachusetts installer New England Clean Energy surveyed nearly 250 of its customers and found that the majority of households installing solar are middle class.


U.S. Renewables Continue To Outpace Coal, Oil And Nuclear In New Capacity

New U.S. capacity from renewables so far this year is almost 35 times that of coal, oil and nuclear combined - 3,598 MW vs. 104 MW. Solar and wind are running virtually neck-and-neck, with 1,671 MW and 1,614 MW, respectively.


Energy Department Invests Millions More In Cost-Cutting Solar R&D

The U.S. Department of Energy (DOE) is awarding $53 million to dozens of research and development (R&D) projects that aim to drive down the cost of solar energy.


TVA Reconsiders Solar's Role And Value In New Resource Plan And Grid Study

Critics point to wide variations in caps and premiums paid for solar under the Tennessee Valley Authority's (TVA) current plan. The utility agency says it will incorporate more solar stakeholders in future programs.


After Massachusetts' 'Godfather Of Solar' Exits, Will The New Gov. Step Up?

Bay State solar developers and suppliers look back on the legacy of Gov. Deval Patrick while awaiting Massachusetts’ incoming chief executive.

Lufft_id1410
GoIndustry (UK) Limited_id1446
CanSolIndus_id1429
PVcobra_id1394
Ingeteam_id1433