Solar sector attracts $3.86 billion funding in Apr-Jun

The attracted funding includes 40 deals, including three Indian transactions

The solar sector has attracted total funding of $3,857 million through 70 deals, including three Indian transactions, in the April-June period this year, says a report.

 

The report that analysed funding on the basis of four categories -- project funding, VC funding, debt funding and others, said there were three Indian deals in the project funding category and one in project M&A segment, wherein, sustainable energy solutions provider Fortum acquired a solar power plant in Rajasthan.

 

The three Indian deals that were listed in the project funding category, include Acme Solar's $50 million loan for its 25-MW photovoltaic power plant in Madhya Pradesh, followed by Welspun Energy's financial closure of its upcoming 20-MW solar power project in Maharashtra.

 

Further, Welspun Energy, received around $8 million in funding from financial institutions for its Karnataka solar project.

 

According to the Mercom Capital Group's second quarter funding and M&A activity report for solar sector, the VC funding in the solar sector continued to be subpar in the second quarter of 2013, with $189 million in VC funding in April-June period compared to $126 million last quarter.

 

Among the VC deals solar downstream companies received $128 million in funding, Mercom Capital said.

 

"With solar technology companies struggling, investments have been going to downstream companies," Mercom Capital Group CEO Raj Prabhu said.

 

Prabhu further added that "investments into solar technology companies haven't completely dried up. Small venture rounds are still going to several niche technology companies instead of the larger deals that were typical for thin film, CSP and CPV companies".

 

Meanwhile, solar M&A activity in Q2 2013 amounted to $1.27 billion in 18 transactions.

 

"Themes emerging out of this quarter's M&A activity included: consolidation in the inverter market, strategic acquisitions, and acquisitions of distressed assets/ companies," Mercom Capital added.