Last year, total global funding into the wind sector reached $28.1 billion, according to a new report from Mercom Capital Group. This includes venture capital (VC) funding, public market financings, debt financings and announced project funding deals.
The report says VC funding increased to $455 million in 2013, compared to $315 million in 2012. In the fourth quarter, such funding came to $93 million in six deals, compared to $135 million in four deals the previous quarter.
According to Mercom, there were seven downstream companies that raised a combined $374.3 million in 2013. Six small wind turbine manufacturers raised $68.8 million, one wind component company raised $6.2 million and three monitoring software companies raised $5.5 million.
The report says the top VC-funded company in 2013 was ReNew Power, an Indian wind project developer, which raised $135 million, followed by Mainstream Renewable Power, an independent renewable energy project developer, which raised $133 million. NSL Renewable Power, also a project developer from India, raised $60 million, and Ogin (formerly FloDesign), a manufacturer of small wind turbines, raised $55 million. Green Infra, a renewable power producer from India, raised $25 million.
Public market financings accounted for $5.8 billion in 17 deals in 2013, including six initial public offerings (IPOs) totaling $2.3 billion.
The report adds that announced large-scale project funding in 2013 amounted to $18.1 billion in 114 deals, compared to $14 billion in 72 deals in 2012. There were a total of 150 investors that participated in project funding last year. Mercom says the most active project funding investors were KfW IPEX-Bank with nine deals, followed by the European Investment Bank with seven deals, and Nord/LB with six deals. Announced large-scale project funding in the fourth quarter ($4.9 billion in 32 deals) increased compared to the third quarter ($3.9 billion in 21 deals).
According to the report, the fourth quarter was very active for large-scale project development activity around the world. Mercom tracked about 104 project announcements totaling almost 10.7 GW in various stages of development.
In addition, the company says 2013 was a strong year for mergers and acquisitions (M&A) activity in the wind sector, with 33 transactions, 18 of which were disclosed for a combined $2.6 billion. By comparison, 2012 saw 35 transactions.
Of the 33 M&A transactions in 2013, the report says wind downstream companies accounted for 20 of them, wind component companies accounted for six, service providers and manufacturers accounted for three each, and balance-of-system companies accounted for one transaction.
Mercom says the top M&A transaction in 2013 was the $1.25 billion acquisition of Kaydon Corp., an industrial manufacturer and supplier of wind turbine bearings, by SKF Group, a global supplier of bearings, seals, mechatronics, lubrication systems, and other services.
This was followed by the acquisition of the Polish onshore wind business of DONG Energy, a company involved in procuring, producing, distributing and trading in energy and related products, by two Polish power utilities – Polska Grupa Energetyczna and Energa – for $314 million.
Brookfield Renewable Energy Partners, an operator of pure-play renewable power platforms, acquired vertically integrated renewable energy production company Western Wind Energy for $182 million. Private-equity firm Actis acquired 60% of Atlantic Energias Renovaveis, a Brazilian renewable energy company, for an initial commitment of $169 million. Rounding out the top five transactions was the acquisition of wind energy developer Salus Fundos de Investimento em Participacoes by Brazilian utility Copel for about $128 million, the report adds.
Disclosed project acquisitions increased in 2013, with 116 transactions – compared to 72 transactions in 2012 – representing over 16 GW that changed hands. There were 37 project acquisitions in the fourth quarter compared to 26 in the third.
The report says the top five large-scale wind project acquisitions in 2013 included the $577 million acquisition by SEAS-NVE of an 80% stake in the 207 MW Rodsand II offshore wind project from E.ON; Portland General Electric's acquisition of Puget Sound Energy's 267 MW Lower Snake River Phase II Wind Project for $535 million; Blue Energy's acquisition of the 177 MW RidgeWind portfolio from HgCapital for $392 million; Scottish and Southern Energy's acquisition of the 99 MW Dunmaglass Wind Project from Renewable Energy Systems for $305 million; and Iberdrola Renewables Polska's sale of 184.5 MW of wind projects to Polish companies Energa Hydro and Polska Grupa Energetyczna for $265 million.
Announced debt financing amounted to $3.8 billion in 10 deals in 2013, compared with $12.5 billion in 16 deals in 2012, the report continues. There were 34 new cleantech and wind-related funds announced in 2013 – 14 were announced in the fourth quarter.