Minnesota-based ALLETE, an energy company, has signed a definitive agreement to acquire 100% of the membership interests in New Energy Equity, a distributed solar project developer, for approximately $165.5 million, subject to a working capital adjustment.
New Energy Equity has completed more than 250 projects across the U.S., totaling over 310 MW. New Energy Equity offers its customers comprehensive solar operations, maintenance, and asset management services through its wholly-owned subsidiary, Energy Support Services.
Recently Impact Power Solutions (IPS Solar) was acquired by New Energy Equity. IPS Solar will retain its branding and corporate headquarters in Roseville, Minnesota.
“New Energy Equity strong track record of success, robust project pipeline, and significant growth potential will support ALLETE’s long-term average annual growth objective of 5-7%,” said ALLETE Chair, President, and CEO Bethany Owen.
“Our team is excited to join the ALLETE family of companies, bringing broadened expertise and access to capital to New Energy Equity,” said New Energy Equity President and CEO Matthew Hankey.
ALLETE expects the purchase to close in mid-April upon satisfaction of customary closing conditions. New Energy Equity’s entire team, including management, will remain in place and its Maryland headquarters.
J.P. Morgan acted as an exclusive financial advisor to ALLETE on this transaction.
According to Mercom’s Q4 2021 solar funding and M&A report, M&A activity in the solar sector soared with 126 transactions in 2021 – the highest number of deals ever recorded. Most of the transactions involved Solar Downstream companies. In February 2022, Energy Infrastructure Partners (EIP), a Switzerland-based investment manager specializing in the energy sector, agreed to acquire a 30% stake in Boralex’s assets and development pipeline in France, for $596 million, as part of its long term partnership. The assets under the deal include more than 70 solar and wind projects in operation with total output exceeding 1 GW and a 1.5-GW development pipeline across France.