Record large-scale project acquisitions of 24 GW in 9M 2018 recorded
Total corporate funding (including venture capital funding, public market and debt financing) in the first nine months (9M) of 2018 came to $6.7 billion, slightly lower than the $7.1 billion raised during the same period in 2017. There were 103 deals in 9M 2018 compared to 143 deals in 9M 2017.
“Decline in solar demand around the globe has had a strong effect on corporate financing activity in solar especially with most solar company stocks in the negative territory at the end of the third quarter. M&A activity on the other hand has remained robust especially project acquisitions,” said Raj Prabhu, CEO of Mercom Capital Group.
Global VC funding (venture capital, private equity, and corporate venture capital) for the solar sector in 9M 2018 totaled $889 million, a 10 percent decrease compared to the $985 million raised in 9M 2017. VC funding for the solar sector held steady in Q3 2018 with $359 million raised in 12 deals compared to the $370 million raised in 15 deals in Q2 2018.
The top VC deal in the third quarter of 2018 was the $200 million raised Cypress Creek Renewables. It was followed by Nexamp’s $54 million, Cleantech Solar’s $50 million, Arcadia Power’s $25 million, and the $10 million raised by Pegasus Solar. A total of 25 VC investors participated in solar funding in the third quarter of 2018.
Solar public market funding was higher in 9M 2018 with $1.8 billion raised in 14 deals compared to $1 billion raised in 23 deals in 9M 2017.
Debt financing activity in the first nine months of 2018 declined by almost 21 percent to $4 billion in 40 deals compared to 9M 2017 when $5.1 billion was raised in 51 deals.
Announced large-scale project funding in 9M 2018 crossed $11 billion for the development of 137 projects. For the third quarter of 2018 alone, announced large-scale project funding came in at more than $3 billion in 39 deals.
Announced residential and commercial solar funds totaled $1 billion in 9M 2018, compared to the $2.2 billion raised during the same period of 2017.
The first nine months of 2018 saw a total of 64 solar M&A transactions, compared to the 59 transactions seen in 9M 2017. Of the 18 total transactions in Q3 2018, nine involved solar downstream companies, six involved BOS companies, two were with service providers, and one was with a module manufacturer.
There were 166 large-scale project acquisitions in 9M 2018 aggregating over 23.6 GW, compared to 161 project acquisitions totaling 14.6 GW during 9M 2017.
Project developers were the most active acquirers in Q3 2018, purchasing 22 projects totaling 8.5 GW, followed by investment firms with 21 projects totaling 2.86 GW.
About Mercom Capital Group
Mercom Capital Group, llc, is a global communications and consulting firm focused exclusively on clean energy and financial communications. Mercom’s consulting division advises cleantech companies on new market entry, custom market intelligence and overall strategic decision making. Mercom’s consulting division also delivers highly respected industry market intelligence reports covering Solar Energy and Battery Storage/Smart Grid/Efficiency. Our reports provide timely industry happenings and ahead-of-the-curve analysis specifically for C-level decision making. Mercom’s communications division helps clean energy companies and financial institutions build powerful relationships with media, analysts, government decision makers, local communities and strategic partners. For more information about Mercom Capital Group.
Notable India Deals:
- Cygni Energy – a manufacturer of efficient solar controllers for domestic homes and SOHO applications – raised $6.4M through a combination of equity and debt. The equity funding was led by early-stage venture capital firm Endiya Partners and the debt by IndusInd Bank.
- SenseHawk – a cloud-based enterprise platform leveraging artificial intelligence (AI) analytics on data collected from autonomous systems such as drones – raised $2 million from SAIF Partners and other angel investors.
- Phelan Energy Group raised $40 million for a 50 MW solar project in Rajasthan from the Power Finance Corporation.
CLP India – a wholly-owned subsidiary of Hong Kong-based CLP Holdings – acquired a 49 percent stake in two of Suzlon’s solar projects in India totaling 70 MW.