THE SOLAR BUSINESS NOW

Solar Funding and M&A Q2 2012 Report; Funding and merger & acquisition activity for the solar sector

July 2012 (Mercom Capital)

“Venture capital (VC) funding in the solar sector was slighly up in Q2 2012 with $376 million in 32 deals compared to $329 million in 34 deals in Q1 2012. With news of solar companies downsizing or going out of business seemingly every day, continued steady VC funding is good news…[but] the average VC deal size has been consistently dropping since 2010 with large VC deals becoming rare.

“CIGS and solar lease companies continue to be popular with investors…At the end of the first half of 2012, solar downstream companies are slightly ahead in VC funding with $251 million compared to $239 million raised by CIGS companies.”

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“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…[Balance-of-system (BOS)] is now the largest slice of the solar system pie, but VC investments in BOS have been surprisingly low.

“A total of 60 VC and Private Equity (PE) investors participated in 32 deals in Q2, with Crosslink Capital, Kleiner Perkins Caufield and Byers and the International Finance Corporation’s (IFC) VC/PE arm participating in multiple deals…There were 14 M&A transactions in Q2 2012 totaling $325 million…There were 13 new cleantech and solar-focused investment funds announced this quarter, commiting a total of $3.2 billion…[and] 13 bankruptcies and insolvencies in Q2…[S]even of the 13 were thin film companies…[16 companies] announced restructuring and downsizing…”

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