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VC funding sees slight
uptick with $376 million, even in tough solar market
Mercom Capital Group, llc, a
global clean energy communications and consulting firm, today released its
report on funding and mergers and acquisition (M&A) activity for the solar
sector during the second quarter of 2012.
Venture Capital (VC) funding
in the solar sector came in at $376 million in 32 deals in Q2 2012 compared to
$329 million in 34 deals in Q1 2012. Downstream
companies, have received the most with $133 million in nine deals, followed by
thin film companies with $121 million in four deals this 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,” said 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. In this quarter we are finally seeing VC investments catch up, with downstream receiving the most funding. Balance-of-system 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.”
VC investment in BOS
companies has totaled only $35 million this year.
 The top five VC funding deals
made up approximately 71 percent of the total funding in this quarter, led by a
$70 million raise by CIGS thin film maker, Nanosolar. Other top VC deals
included $60 million by solar lease company SunRun, and $55 million 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. Venture capital firms that
recorded multiple rounds included Crosslink Capital, Kleiner Perkins Caufield
& Byers and the VC - Private Equity arm of International Finance
Corporation. The United States continued to be the dominant country for VC
investments, accounting for approximately 87 percent of all VC funding in the
second quarter.
 M&A activity in the
solar sector totaled $325 million in 14 transactions. Only six of these
transactions disclosed details. The top M&A transaction was the acquisition of Zhejiang Topoint Photovoltaic, a Chinese
mono 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,” said Prabhu. “In some cases, acquisitions were of ‘sick’ companies getting rid of non-strategic
businesses and assets.”
The second quarter of 2012
also saw 13
new cleantech and solar-focused investment funds announced committing $3.2
billion.
For a complete list of Q2
2012 transactions in the solar sector, visit: http://mercomcapital.com/cleanenergyreports.php
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, Wind
Energy and Smart Grid. 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, visit: http://www.mercomcapital.com.
To get a copy of Mercom’s popular market intelligence reports, visit: http://mercomcapital.com/market_intelligence.php
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