Corporate Funding Flows into Global Solar Power Sector in 2014

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--In the first quarter of 2014, about $7 billion worth of funding from global corporate sources was committed to the solar energy sector. The sources included venture capital and private equity.

Total global corporate funding in the solar sector from venture capital, private equity, debt financing and other equity financing raised by public companies totaled about $7 billion in the first three months of this year. Similar funding amounted to about $5 billion in the fourth quarter of 2013, according to Mercom Capital Group (Bangalore, India).

The number of merger and acquisition deals in the solar sector jumped to 38 in the first quarter of 2014, compared with 25 transactions in the same period of 2013.

"M&A [mergers and acquisitions] were strong among installers, developers and distributors, while third-party finance firms were actively making acquisitions as they vertically integrate their businesses," said Mercom Chief Executive Raj Prabhu. Speaking in Mumbai, he said that the big story continued to be strong capital markets. In the first quarter of 2014, most of the 38 deals involved downstream companies.

In terms of project acquisitions, in the first quarter there were about 42 transactions totaling $1.5 billion. These projects had a combined generation capacity of more than 1,700 megawatts (MW). There were up to 43 large-scale project funding deals worth $3.6 billion announced in the quarter.

Global venture capital funding, private equity and corporate venture capital in the first quarter of 2014 totaled $251 million in 26 deals, up from $87 million in 24 deals in the same period in 2013. Solar downstream companies attracted the larger part of the venture capital in the quarter, with $182 million in 13 deals.

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