Q1 solar sector funding down by 30% due to coronavirus - Mercom

Source: Mercom Capital Group (mercomcapital.com).

Due to the impact of the COVID-19 crisis global corporate solar funding in January-March 2020 fell by 31% year-on-year and by 30% quarter-on-quarter to USD 1.9 billion (EUR 1.75bn), Mercom Capital Group announced.

“Funding levels dropped in Q1 as the Coronavirus pandemic brought the global economy to a halt. Most large economies are shut down, and there is minimal activity in the solar markets,” said Mercom chief executive Raj Prabhu. He added that the worst may be yet to come, but hopefully things will improve in the second half of 2020.

The table contains details on quarterly funding activity based on Mercom’s Q1 2020 Solar Funding and M&A Report.

	Q1 2020 value	N of deals	Q1 2019 value	N of deals
Total venture capital funding	145 million	9	176 million	13
Solar public market financing	22 million	1	259 million	3
Debt financing	1.8 billion	7	2.4 billion	19
TOTAL corporate funding	1.9 billion	--	2.8 billion	--

The top venture capital transations in the period involved Sunseap Group, which raised USD 109 million in two deals.

Q1 ACQUISITIONS

Mercom reported 12 solar M&A deals for the past quarter, of which 11 involved downstream solar companies. The number of M&A transactions was 18 a year earlier.

Large-scale project acquisitions in January-March 2020 jumped to 55. The value of eight was disclosed and reached USD 4.1 billion in total. This compares to 54 project acquisition in the first quarter of 2019, with the total value of the 20 disclosed amounting to USD 1.4 billion.

“Solar project M&A was the bright spot in this time of uncertainty, proving once again that solar is a safe long-term bet,” Prabhu said.

Projects with a combined capacity of 12 GW got new owners in the reporting quarter. Oil and gas companies bought nearly 6.5 GW of solar projects, or 53% of the total. Investment firms accounted for 34%.

(USD 1 = EUR 0.92)

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