Last year, total global funding into the wind sector reached $31.7 billion, according to a 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 $311 million in 2014, compared to $455 million in 2013.
Wind mergers & acqusition (M&A) activity in 2014 amounted to $4.6 billion in 28 transactions, only 12 of which disclosed transaction amounts. In 2013, by comparison, there was $2.6 billion in 33 transactions, 18 of which disclosed transaction details. The majority of these transactions involved strategic acquisitions, divestments and acquisitions of distressed assets.
Most of the transactions involved downstream companies, as 20 transactions accounted for $4.59 billion. Service providers had four transactions totaling $9 million, notes Mercom.
Of 28 total transactions, six originated in the U.S. Aqualis, an offshore marine and engineering consultancy firm, was the only multiple acquirer this year with two acquisitions; Tristein, a solution provider for offshore installations, was acquired for $7.8 million, and Offshore Wind Consultants, a U.K.-based provider of offshore wind consultancy, was acquired for $1.4 million.
The top disclosed M&A transaction in 2014 was the $2.4 billion acquisition of First Wind, a developer, owner and operator of wind projects, by SunEdison and its yieldco company TerraForm Power.
‘There has been an increase in the number of new yieldcos in the market, and for yieldcos to grow, they must continually add new projects to their portfolio,’ according to Mercom Capital. ‘We will see a lot more yieldcos jumping into wind in the near future and start actively acquiring quality wind projects worldwide.’
The second-largest transaction involved investor Kohlberg Kravis Roberts, which purchased a 33.33% stake in ACCIONA's renewable energy generation unit for $567 million.