Total corporate funding in the solar sector increased 24 percent in 2020
Post date: 12/01/2021 - 09:37
Mercom Capital Group, llc, released its annual report on funding and merger and acquisition (M&A) activity for the solar sector in 2020. Total corporate funding into the solar sector globally, including venture capital, private equity (VC), debt financing, and public market financing, came to $14.5 billion, a 24 percent increase compared to the $11.7 billion raised in 2019.
»Following a tough first half when corporate funding was down 25 percent year-over-year, recovery has been swift and broad,« said Raj Prabhu, CEO of Mercom Capital Group. Global venture capital and private equity (VC/PE) funding in the solar sector in 2020 came to $1.2 billion in 41 deals, compared to $1.4 billion in 53 deals in 2019. Of the $1.2 billion in VC/PE funding raised in 41 deals in 2020, $1.1 billion went to 27 solar downstream companies, which accounted for 90 percent of total VC funding in 2020. Solar service providers raised $61 million; PV companies raised $17 million; thinfilm technology companies raised $15 million, and concentrator photovoltaics (CPV) companies raised $5.5 million.
The top VC funded companies in 2020 were Ayana Renewable Power, which raised $390 million, Silicon Ranch Corporation, which brought in $225 million, Brighte ($76 million), Sunseap Group ($72 million) and Aurora Solar and Zero Mass Water (each $50 million). According to the consulting company, there were 102 VC and PE investors that participated in funding deals in 2020, with five involved in multiple rounds.
Public market financing was up 101 percent, with $5.1 billion in 2020. Array Technologies raised $1.2 billion in its initial public offering (IPO) in the fourth quarter of 2020. The top investors in large-scale projects in Q4 2020 were Societe Generale, which invested in five projects. This was followed by Sumitomo Mitsui Banking Corporation, which invested in four projects. Credit Agricole, European Bank for Reconstruction and Development (EBRD), and Inter-American Investment Corporation (IDB Invest), each investing in three projects.
62 merger and acquisition (M&A) deals were transacted in the solar sector in 2020 compared to 65 in 2019. Most of the transactions involved solar downstream companies. The largest transaction in 2020 was Sunrun’s acquisition of Vivint Solar, in an all-stock transaction for $3.2 billion.
There were 231 large-scale solar project acquisitions in 2020 compared to 192 transactions in 2019. A record 39.5 GW of large-scale solar projects changed hands in 2020 compared to 26.1 GW in 2019. This was the largest amount of projects acquired in a single year to date, says Mercom.