Solar M&A, VC funding rebounds

Money pouring into the solar space rebounded strongly in the last quarter, and particularly in the US, as the powerful recent rally in PV shares brings confidence back to the market.

Total corporate funding across the global solar industry – including venture capital, debt financing and other equity raised by public companies – hit $2.18bn in the third quarter of 2013, compared to $915m during the same period last year, according to market researcher Mercom.

Venture capital funding bounced back to $207m, up from a multi-year low of $72m during the third quarter last year. As usual, the VC froth was centred on the US, where four of the top five deals were done, led by Solexel and eSolar.

Third-party solar finance companies, such as SolarCity and SunRun, disclosed $2.4bn in new project funds through the first three quarters of the year, up from about $2bn at the same point last year.

Meanwhile, on the projects side, First Solar claimed the largest and fourth-largest acquisitions, buying a 1.5GW pipeline in Mexico and the US from Element Power, and the 250MW Moapa project from K Road Power, respectively.

Goldpoly claimed the second largest projects acquisition, buying 400MW from a consortium of Chinese developers led by GD Solar.

Mergers and acquisition activity in the solar space rocketed to $9.8bn during the third quarter, although that figure is deceptively high, as it includes Applied Materials’ recent $9.4bn buy-out of Tokyo Electron. The Japanese company makes production equipment for the thin-film PV sector, although that represents a tiny sliver of its business.

Other significant M&A deals during the quarter included Chinese polysilicon maker Tongwei’s acquisition of a subsidiary of LDK Solar, SolarCity’s $120m acquisition of direct-sales outfit Paramount Solar, and First Solar’s purchase of GE’s solar intellectual portfolio for shares worth about $84m.